August 19, 2019 9:15am

It was volatile last week; who says it’s about to change?

Warning “shots” have been fired; proceed cautiously; don’t get “sucked-in”

RMi outlines the preludes of a new week defining the mitigating factors of share pricing - I’d be taking money ‘off the table” in reference to some upsides

 

 

The remainder of the month’s trading sessions will be critical for the RegMed sector which will establish whether expectation of the “dog day’s” of August

 

Dow futures are UP +1.06% (+274 points), S&P futures are UP +1.04% (+30 points) and NASDAQ futures are also UP +1.30% (+99 points)

 

U.S. stock index futures pointed to a higher open as “voices” from the administration sought to calm investors over growing concerns about the trade war and the U.S. economy;

European stocks rose as hopes emerge for stimulus from central banks and fiscal measures from major economies such as China and Germany as the pan-European Stoxx 600 jumped 1%;

Asia pacific stocks rose as U.S. Treasury yields bounced higher after plunging last week while shares in mainland China led gains in the region as they surged on the day.

  • On Saturday, the People’s Bank of China said it will improve the mechanism used to establish the loan prime rate from this month, allowing it to “use market-based reform methods to help lower real lending rates.”

 

Henry’omics:

Do we anticipate a rebound in the markets = we do but … a rebound of volume in the cell and gene therapy universe usually “smells” trouble of being sold into!

I am NOT trusting of the algorithmic “rules” and machine driven trading – I’d be “lightening some of my load” of Friday’s upside for protection – even IF they rise!

The bond market sent a warning, and this time the stock market listened; however, investors will be looking for clues in the week ahead that the current upside is … SUSTAINABLE!

The yield on the 10-year U.S. Treasury note on Wednesday briefly traded below the yield on the 2-year note, marking an inversion of the yield curve — a phenomenon seen as an often reliable recession indicator, albeit with an average lag of more than a year. In fact, the 10-year yield has traded below the 3-month T-bill yield since late May — an inversion of that portion of the curve is seen by economists as an even more reliable recession indicator <MarketWatch>.

From Friday’s evening post, “a whacky week.”

  • The NASDAQ was up +129.38 or +1.67% to 7,895.99;
  • The IBB closed up +2.23% while the XBI closed up +2.65%;
  • The close was positive with an A/D Line of 39/3 and 1 flat and 2 acquired;
  • The range of the 39 upside was +0.43% (BSTG) to +31.22% (SLDB) while the 3 downside ranged from -0.84% (BCLI) to -7.08% (BTX);
  • 4 out of the 39 upside had higher than the 3 month average volume;
  • 2 out of the 3 downside had higher than the 3 month average volume;

August has 6 POSITIVE and 7 NEGATIVE closes, so far

 

Companies in my headlights – It’s your decision; I provide an idea and context:

*** As I said in the title; don’t get sucked into to a perceived sustainable upside ***

 

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.