While the Nasdaq 100 is on pace for its worst November since 2008, healthcare equities are showing remarkable strength.

The Healthcare Select Sector SPDR Fund (NYSE:XLV) is up nearly 6% month-to-date, its best monthly performance since January and the top-performing sector in the S&P 500 for November so far.

This divergence is now shaping up to be one of the largest monthly outperformance gaps between healthcare and tech since 2002, according to historical ETF return data.

Chart: Healthcare Stocks Battle For Best Month Versus Tech Since 2002

Follow The Flows: Biggest Healthcare Inflows Since Jan 2021

Investor flows are confirming the rotation. According to Bank of America's latest Flow Show report, compiled by the bank’s chief investment strategist Michael Hartnett, healthcare just recorded its largest weekly inflow since January 2021.

In a market environment defined by uncertainty, high valuations, and cooling rate-cut bets, investors are increasingly treating healthcare as a defensive haven, the place to be when things unravel elsewhere.

Valuations Matter: Tech Expensive, Healthcare Still Cheap

Part of the renewed appeal in healthcare is driven by valuation.

Despite this week's tech pullback, technology stocks still trade at rich multiples.

The S&P 500, tracked by the Vanguard S&P 500 ETF (NYSE:VOO), currently trades at a forward P/E ratio of 23x, but the XLK sits even higher at around 30x.

In contrast, the XLV trades at 20x forward earnings, making healthcare one of the cheapest sectors in the market, alongside financials, utilities and energy.

This valuation gap offers a compelling hedge. If rates do not fall as predicted or inflation makes a comeback, expensive growth stocks could remain under pressure, while sectors with strong cash flows, stable margins, and lower multiples—like healthcare—may see continued investor interest.

Top-Performing Healthcare Stocks In November 2025

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