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Hospital stock prices rise despite Fed rate hike

March 16, 2017

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Investors in hospital stocks brushed aside a Federal Reserve interest-rate hike of one-quarter point Wednesday, pushing the stock prices higher almost across the board. Hospitals, both investor-owned and not-for-profit, are sensitive to interest-rate increases because they rely heavily on debt for expansion and facility replacement.

But the small increase still leaves the overall Fed rate at between 0.75% and 1%, a level attractive to all-but the lowest-rated borrowers, Fitch Ratings managing director Megan Neuburger noted late last week.

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