September 27, 2018 7:30am
How many of us will be watching the Senate hearings than be paying attention to the sector and market
Let’s shed some light on the oversold, of which there are many
Pre-open indications: 1 SELL and 1 BUY
Presenting alternative hypotheses clarifies material facts and evidence available to investors. “Devil’s Advocacy” also provides greater confidence that the current sector outlook will hold-up to close scrutiny!
Spare the SELL call, underfund the portfolio – SUBSCRIBE!
U.S. stock index futures are under pressure
Dow futures are UP +0.06% (+17 points) and NASDAQ futures are UP +0.26% (+20 points)
U.S. stock index futures fluctuated ahead of Thursday's open.
European stocks came under pressure, as investors’ monitored political news going on around the world
Asia markets were largely negative, on the back of U.S. Fed's comments on inflation after the central bank decided to increase interest rates
Data docket: jobless claims, durable goods, and advanced economic indicators are due out at 8:30 a.m. ET. At the same time, another reading of real gross domestic product (GDP) data will be published. At 10 a.m. ET, pending home sales are due, followed by the Kansas City Fed's manufacturing survey at 11 a.m. ET.
Today’s indications:
- The iShares Nasdaq Biotechnology (IBB) is NOT indicating in Thursday’s pre-market;
- The SPDR S&P Biotech ETF (XBI) is NOT indicating in Thursday’s pre-market;
- The Health Care Select Sector SPDR ETF (XLV) is NOT indicating in Thursday’s pre-open;
- The iShares Russell 2000 (IWM) is indicating a +0.8% SIDE in Thursday’s pre-open
Henry’omics:
I am NOT forgetting the plight of the OVERSOLD!
The attention getter of the day will be Supreme Court nominee Brett Kavanaugh appearance on the Senate Judiciary Committee hearing, amid multiple accusations of sexual misconduct. Kavanaugh has denied the allegations.
Could trading … be lessened during the hotly anticipated hearing of Supreme Court nominee Brett Kavanaugh?
The hearing is something people are likely to have on in the background and may watch for the first 10-15 minutes then start drifting back to work, similar to last year’s testimony from former FBI Director Comey.
But, the curiosity effect is HUGE!
It’s high drama …
I always want to know what happened PRIOR to what might happen today – it sets a tone of consequence:
From Wednesday’s night’s newsletter: “kicking the can of equities down with alternating volatility. Investors cringe as value is destroyed, although some equities deserve the decline. What’s to emanate from follow-on sessions - bargain hunting as to which equities become oversold enough to BUY!”
I also stated, “The trend is definitely not our friend today … as the sector got sideswiped by trading! The dynamics of the sector has decimated sentiment and confidence. Risk is always a factor in drug development however, trading decimates share pricing – so does it mean that we should exit the sector based on its volatility. NO … but market breadth data is painting a more negative picture while volume is low, inclining to the downside and declining to the upside! But, we do need to understand that a bounce-back will be in the cards.”
The iShares NASDAQ Biotechnology (IBB): a week’s history lesson
- Wednesday closed up +0.34%
- Tuesday closed up +0.23%
- Monday closed up +1.19%
- Friday closed down -0.62%
- Last Thursday closed up +1.39%
- For a five session aggregate of +2.53% - consider a slow upside move!
Of the 45 companies covered on Tuesday; 32 downside equities finished in a range of -0.17% (MDXG) to -8.39% (CLBS) while 12 upside equities oscillated from +0.76% (SAGE) to +11.34% (MESO) with 1 flat closes (RENE.L).
In 17 sessions in September (so far) – there were 9 negative closes and 8 positive close;
In 21 August sessions – 6 had negative and 15 had positive closes
Companies in my headlights – It’s your decision; I provide the idea and context:
Applied Genetic Technologies (AGTC) closed up +$0.20 to $6.50 after Tuesday’s +$1.30 to $6.30 after Monday’s +$0.60 to $5.00 on the basis of a comparables (Nightstar Therapeutics (NITE) which was based on released initial data from a P1/2 study of its product candidate NSR-RPGR that showed multiple patients achieved an improvement in microperimetry, There is a $2.10 or +33% in three (3) sessions, an “Icarus” flight – Maintaining SELL;
Fate Therapeutics (FATE) closed down -$.30 to $15.33 after Tuesday’s -$0.11 to to $15.63. FATE closed its offering of 10.6 M shares, which included 1.388 M shares that were exercised by an option to purchase additional shares, at a price of $13.50 per share. Aggregate gross proceeds from this offering, including exercise of the option, were approximately $143.8 million, prior to deducting underwriting discounts and commissions and estimated offering expenses – 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.
