October 7, 2019 5:05pm

October’s volatility has historically spooked investors

Sentiment is an issue, the major concern as Q3 ended with depreciation which continues

It's a daunting task to understand risk, seeing the unforeseen; on the basis of my own “rules”, I set-up my own “warning analysis” which isn’t machine oriented!  

 

Just like algorithms, rules-are-what-we-make-of-them. The take-away, don’t dwell on what’s happened but, learn the lesson of timing – Q3 LPS (loss-per-share) results are being “formulated”.

 

The Dow closed down -27.30 points (-0.10%), the S&P closed down -13.22 points (-0.45%) and the NASDAQ closed down -26.18 points (-0.33%)

 

The iShares NASDAQ Biotechnology (IBB) and the SPDR S&P ETF (XBI) indicators:

  • Monday the IBB closed down -0.12% while the XBI closed down -0.19%
  • Friday the IBB closed up +0.74% while the XBI closed up +0.16%

 

Henry’omics:

Sector equities and market indexes fell slightly on Monday as investors looked ahead to U.S.-China trade talks, which are set to begin later this week.

The world’s two largest economies have imposed tariffs on billions of dollars’ worth of one another’s goods since the start of 2018, battering financial markets and souring business and consumer sentiment <CNBC>.

The sector and markets came into Monday’s session after the Dow and S&P 500 posted their third straight weekly decline after a flurry of disappointing U.S. economic data suggested the ongoing trade war was starting to take its toll, stoking concerns of a possible recession.

 

We are so dependent on sector and geo-political news … for momentum!

So goes “our’ universe as the world turns and markets get burned!

 

The advance/decline line scenario of 45 covered companies:  

  • Monday the close was negative with an A/D line of 17/25, 1 flat and 2 acquired;
  • Friday the close was positive with an A/D line of 24/17. 2 flats and 2 acquired;

 

Decliners:

  • ReNeuron (RENE.L -$2.50 after Friday’s +$14.50 after Thursday’s -$38.00, Wednesday’s -$64.00, Tuesday’s -$20.00 and last Monday’s +$17.50);
  • Global Blood Therapeutics (GBT -$2.36 after Friday’s -$0.92 and Thursday’s +1.58);
  • Regenxbio (RGNX -$1.08);
  • Homology Medicine (FIXX -$0.79 after Friday’s -$0.81);
  • Sage Therapeutics (SAGE -$0.68 after Friday’s -$1.13, Thursday’s +$5.00 , Wednesday’s +$1.25, Tuesday’s -$4.01 and last Monday’s -$2.46);

Incliners:

  • Ions Pharmaceuticals (IONS +$1.47);
  • CRISPER Therapeutics (CRSP +$1.44);
  • BioLife Solutions (BLFS +$0.50 after Friday’s-$0.62);
  • Spark Therapeutics (ONCE +$0.46);
  • Ultragenyx (RARE +$0.30);

 

The percentage (%) indicators: 

  • Monday’s range of the 17 upside was +0.47% (ONCE) to +5.36% (ONVO) while the 25 downside ranged from -0.05% (ALNY) to -7.08% (BTX);
  • Friday’s range of the 24 upside was +0.14% (IONS) to +8.63% (RENE.L) while the 17 downside ranged from -0.41% (PSTI) to -7.62% (ONVO);

 

Upside volume stats:  to compare

  • Monday: 3 out of the 17 upside had higher than the 3 month average volume;
  • Friday: 7 out of the 24 upside had higher than the 3 month average volume

Downside volume stats:

  • Monday: 8 out of the 25 downside had higher than the 3 month average volume;
  • Friday: 3 out of the 17 downside had higher than the 3 month average volume;

 

1 flat – MDXG with 2 acquired (AST & OSIR) and Spark Therapeutics’ (ONCE) acquisition by Roche is still being delayed (October?)

 

October’s sessions:

Monday closed NEGATIVE with 25 decliners, 17 advancers, 1 flat and 2 acquired (AST & OSIR);

Friday closed POSITIVE with 17 decliners, 24 advancers, 2 flats and 2 acquired (AST & OSIR);

Thursday closed NEUTRAL with 21 decliners, 21 advancers, 1 flat and 2 acquired (AST & OSIR);

Wednesday closed NEGATIVE with 22 decliners, 18 advancers, 3 flats and 2 acquired (AST & OSIR);

Tuesday closed NEGATIVE with 36 decliners, 5 advancers, 2 flat and 2 acquired (AST & OSIR);

 

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.