April 6, 2018 8:00am

Two huge economic events, trade situation and the release of U.S. March payroll data and a speech by Fed Chair Powell could cause more agita in the market, thus the sector

 

High turnover and downside momentum create exaggerated moves 

 

Market timed pre-open indication:  1 SELL and 3 BUYs

 

Where the understanding of the facts shed light on share pricing!

Deleterious open expected

Dow futures are DOWN -1.02% (-249 points) and NASDAQ futures are DOWN -1.08% (-75 points)

 

US futures point to a triple-digit drop at the open as trade tensions intensify

European markets were lower, as an escalating trade standoff between the world's biggest economies rattled investors.

Asian stocks closed mixed after Trump's new tariff threat

 

Today’s concern: a trade war could be brewing rattling investor sentiment across the globe

Data docket:  At 8:30 a.m. ET, the employment situation is due out which is expected to show economic figures on wage growth, unemployment and the state of the job situation in the U.S. Aside from non-farms, consumer credit is due out at 3 p.m. ET.

Political front: Investors will be poring over the data to see if the figures provide any indications as to how the U.S. is performing and what this means for the U.S. Federal Reserve when it comes to the future path of raising interest rates.

 

Today’s indications:

  • The iShares Nasdaq Biotechnology (IBB) is NOT indicating in Friday’s pre-market;
  • The SPDR S&P Biotech ETF (XBI) is NOT indicating in Friday’s pre-market;
  • The Health Care Select Sector SPDR ETF (XLV) is NOT indicating in Friday’s pre-open;
  • The iShares Russell 2000 (IWM) is indicating a NEGATIVE -0.46% downside in Friday’s pre-open

 

Henry’omics:

Today - U.S. stocks looked set to snap a three-session string of wins on Friday, as President Donald Trump’s administration delivered a fresh bout of volatility in the market, with a proposal that amplifies recent tariff threats against China, reviving market rattling trade anxieties. Trump announced late Thursday that he was considering tariffs on another $100 billion in Chinese goods, which would triple the amount of imports facing levies.

From Thursday night’s newsletter: “…swimming with piranhas; just when you might have thought to get back in the sector, algorithms and ETFs bit … after spawning an upside.”

Reiterating: “Beware, algorithms and ETFs keep chaos at work.”

Review the last 5 session’s close (of 40 covered companies):

  • Thursday closed NEGATIVE with 25 decliners, 11 advancers and 4 flats;
  • Wednesday closed POSITIVE with 11 decliners, 28 advancers and 1 flat;
  • Tuesday closed NEUTRAL with 19 decliners, 19 advancers and 2 flats;
  • Monday closed NEGATIVE with 31 decliners, 9 advancers and 0 flats;
  • Last Friday was a market holiday;

 

Volatility (the VIX) is still a big driver and it was down again after Wednesday’s -6.99% after Tuesday’s -10.67% after Monday’s up +18.28% after last Friday was a market holiday post last Thursday’s -12.68%.

A re-cap: ““Weeks and months (since the New Year) have accumulated a bigger pile of (sentiment) manure, as the lack of guidance continues to send shock waves to share pricing as risk is left undefined!”

  • Thursday’s decliners ranged from -0.73% <CAPR -$0.01 > to -12.39% <CLLS -$4.10 > in 25 equities;
  • Thursday’s gainers ranged from +0.52% <ATHX +$0.01 > to +6.08% < BCLI +$0.20> in 11 equities;

 

Consider the iShares NASDAQ Biotechnology (IBB) over the last six (6) sessions is down -2.49%%:

  • Thursday was down -1.62%
  • Wednesday +2.91%
  • Tuesday +0.37%
  • Monday -3.95%
  • Friday was a market holiday
  • Last Thursday +0.72%

 

My evaluation:  Watch and wait, put your wallet in the draw and put on mittens to deter any early and stupid moves …

 

Company in my headlights - speculation:

Adverum Biotechnologies (ADVM) closed up +$0.05 to $5.80 with 463 K shares traded after Wednesday’s +$0.20 to $5.75 with 417.9 K shares traded <3 month average = 1.419 M shares>. The aftermarket indication is a DOWNSIDE -$0.05 or -0.66% - Maintaining SELL;

Cellectis (CLLS) closed down -$4.10 to $29.00 with 5.1 M shares traded after Wednesday’s -$5.43 to $33.10 with 1.48 M shares traded <3 month average = 229.9 K shares>. The aftermarket indication is a UPSIDE +$0.05 or +0.17% as the ADS had been priced at $31.00 – SELL to BUY;

Sangamo Therapeutics (SGMO) closed down -$1.40 to $17.50 with 2.63 M shares traded after Wednesday’s +$1.10 to $18.90 with 2.16 M shares traded <3 month average = 2.17 M shares>. The aftermarket indication is an UPSIDE of +$0.20 or +1.14%. OVERSOLD - Maintaining BUY;

Stemline Therapeutics (STML) closed down -$0.35 to $15.30 after Wednesday’s +$0.85 to $15.55 with 281.5 K shares traded <3 month average = 350.8 K shares>. STML has initiated its rolling submission of a Biologics License Application (BLA) for SL-401 to the U.S. FDA. SL-401 is a targeted therapy directed to CD123 that has been granted Breakthrough Therapy designation (BTD) by the FDA – Maintaining BUY;

 

Opinions expressed are those of the author and are subject to change, and not intended to be a forecast of future events, a guarantee of future results, nor investment advice.

Whether information or intelligence is good, bad or somewhere in between; I put into context what is relevant and useful for investors.  All investments are subject to risks. Investors should consider investment objectives.

Henry McCusker, the editor and publisher of RegMed Investors does not hold or have positions in securities referred to in this publication.