April 8, 2019 5:33pm
Regeneron and Alnylam Pharmaceuticals (ALNY) $800 M alliance structure and uniQure NV (QURE) FDA’s fast-track designation were snubbed by market’s pricing
Financings: Homology Medicines (FIXX) proposes $125 M offering as Sangamo Therapeutics (SGMO) closes $145.5 M financing while Histogenics (HSGX) reverse mergers – from a dud to a thud
Pre-open indications: 1 HIT and 2 MISS
Re-framing the main takeaway … pricing, volume and volatility!
The markets and follow-on sector response are harsh some sessions, but reality is what it is! Instead of trying to guess at what sector will do, I continue to do what I always do, and that means watching what the patterns are telling me.
Markets and indexes:
- The Dow closed down -83.56 points or -0.32% to 26,341.43
- The S&P closed up +2.98 points or +0.10% at 2,895.74
- The NASDAQ was up +15.19 points or +0.19% to 7,953.88
Sector equities got ‘smoked” on Monday as traders sold into strength while digesting gains from the previous week and looked ahead to the start of the LPS (loss-per-share) “earnings” season.
What’s there more to say … I put out the warning scrutiny this a.m.?
The trend that many had hoped to be our friend is getting stretched and at a place where resistance sets in while momentum is nearing overbought territory yet again!
The market flashed one bullish signal to begin Q2/19: a golden cross, where its 50-day moving average crosses above its 200-day moving average, indicating a change in trend. The last time that happened in mid-2016, the S&P 500 rallied roughly 15% in 12 months.
The advance/decline line scenario of 45 covered companies:
- The open was positive with the A/DL to 32/11, 2 flats and 1 acquired (AST);
- The mid-day negative with an A/DL of 15/24 and 5 flats and 1 acquired;
- The close was negative with an A/DL of 18/24 and 3 flats and 1 acquired;
Pre-open post, “don’t get too comfortable, leaps of faith are just that … After a positive week, month and a relative quarter … I am concerned about risk to share pricing and fundamentals.”
My pre-open indications: 1 HITs and 2 MISS
- Alnylam Pharmaceuticals (ALNY) closed down -$2.62 – miss;
- ReNeuron Group (RENE.L) closed up +$23.50 – hit;
- UniQure NV (QURE) closed down -$2.29 – miss;
Cell and gene therapy company’s worst-performers were:
- ALNY (-$2.62), QURE (-$2.29), RGNX (-$1.75), BLUE (-$1.56) and BMRN (-$1.52)
Sector equities posting gains were:
- RENE.L (+$23.50), IONS (+$1.15), SAGE (+$1.12), BLFS (+$0.34) and MESO (+$0.32)
Homology Medicines, Inc. (FIXX) it intends to sell $125 million of its common stock in an underwritten public offering. Homology expects to grant the underwriters a 30-day option to purchase up to an additional $18.75 million of its common stock.
- BofA Merrill Lynch and Cowen are acting as joint book-running managers for the offering. BTIG is acting as the lead manager for the offering. H.C. Wainwright is acting as co-manager.
Sangamo Therapeutics (SGMO) completed its previously announced underwritten public offering of 12,650,000 shares of its common stock at a price to the public of $11.50 per share, including 1,650,000 shares sold pursuant to the exercise in full of the underwriters' option to purchase additional shares.
- Aggregate of gross proceeds to SGMO before deducting the underwriting discounts and commissions and offering expenses, were approximately $145.5 million.
Tonight’s percentage (%) indicators:
- Range of the 18 upside was +0.05% (CLLS) to +56% (HSGX +$0.06) while the 24 downside ranged from -0.24% (BCLI) to -5.28% CLBS).
- 6 out of the 18 upside had higher (than the 3 month average) volume
- 4 out of the 24 downside experienced greater volume (than the 3 month average)
3 flat – BLCM, ADRO and OSIR – with 1 acquired: 1 (AST)
The iShares NASDAQ Biotechnology (IBB) indicator:
- Monday was down -0.43%;
- Friday was up +1.66%;
- Thursday was down -0.41%;
- Wednesday was up +0.59%;
- Tuesday was up +0.81 %;
- Last Monday was up +0.10 %;
Monday closed NEGATIVE with 24 decliners, 18 advancers, 3 flat and 1 acquired (AST);
Friday closed POSITIVE with 12 decliners, 31 advancers, 1 flat and 1 acquired (AST);
Thursday closed NEGATIVE with 30 decliners, 14 advancers, 0 flat and 1 acquired (AST);
Wednesday closed POSITIVE with 16 decliners, 27 advancers, 1 flat and 1 acquired (AST);
Tuesday closed POSITIVE with 11 decliners, 32 advancers, 1 flat and 1 acquired (AST);
Monday (4/1) closed POSITIVE with 19 decliners, 23 advancers, 2 flats and 1 acquired (AST);
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.