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Healthcare ETFs Sell Off on Weak Economic Outlook

P/>NEW YORK ( TheStreet) -- Healthcare ETfs sold off on Wednesday afternoon amid concerns that continued weakness in the economy will depress demand for prescription drugs and healthcare services.

Health insures Aetna (AET - Get Report) and WellPoint (WLP) both raised their year-end outlook, citing lower medical costs as a result of fewer patient visits to hospitals. But that sparked concern that regulators may seek to reign in what insurers charge for their health plans, as they draft new rules under the healthcare reform.

ETFs exposed to the major healthcare insurers are heading lower on Wednesday afternoon. The PowerShares Dynamic Healthcare Services (PTJ) is dropping 1.5% to $19.01, while the iShares Dow Jones US HealthCare Provider (IHF) is shedding 1.5% to $44.76.

Energy sector ETFs were trading weaker after oil inventories jumped higher than expected in the week of July 23. The SPDR Energy Sector ETF (XLE) was marginally positive with its top holdings Exxon Mobil (XOM - Get Report) and Chevron (CVX - Get Report) heading slightly higher. The United States Oil Fund (USO) was down 0.4%.

Boeing (BA - Get Report) led iShares Dow Jones US Aerospace and Defense (ITA). A similarly-focused ETF -- PowerShares Aerospace & Defense (PPA) -- was up marginally.

--Reported by Shanthi Venkataraman in New York.

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Copyright 2010 Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. AP contributed to this report.

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WLP $136.01 1.43%
AET $107.72 0.00%
BA $149.60 0.00%
CVX $109.11 0.00%
ITA $122.41 0.00%


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