So far in 2024, healthcare stocks continue to run slightly behind the broader market: The Morningstar US Healthcare Index has returned about 8.55% this year, versus 9.72% for the broad-based Morningstar US Market Index as of Aug. 7. However, healthcare stocks have significantly outperformed the market during the past month on investor fears about a recession. Healthcare stocks are considered defensive, which suggests they could hold up better than some other sectors during an economic slowdown.

Morningstar director Damien Conover finds solidity in the healthcare sector. “Despite other sectors having more dependency on stable or growing…