High interest rates and energy prices impact sector selection

Newton and Fidelity have been busy positioning their American portfolios towards defensive plays such as healthcare and insurance. The fund managers are looking to miss the worst of a consumer and business slowdown possibly led by higher interest rates, now at 4%. Simon Laing, head of US equities at Newton, says the group's American fund is presently overweight healthcare, due to the government's Medicare reform programme, which will see seniors subsidised for healthcare insurance and drug needs. He believes this is positive news for the generic drug companies: sales should increase and...