March 31, 2020 8:45am
It’s time to peel-off or just hold some gains as many haven’t taken into consideration economic and sentiment’s grip on share pricing as market volatility will battle liquidity risks
Pre-open indications: 4 BUYs and 3 SELLs
News: Intellia Therapeutics, Inc. (NTLA closed up +$0.76 or +6.38% to $12.68), the U.S. FDA has accepted the Investigational New Drug (IND) application submitted by its collaborator, Novartis, for a CRISPR/Cas9-based engineered cell therapy for the treatment of sickle cell disease (SCD)– BUY; Bristol Myers Squibb (BMY) and bluebird bio (BLUE closed down -$0.81 to $46.96 and has a pre-market incline of +$1.24 or +22.64) submitted a Biologics License Application (BLA) to the U.S. FDA for its lead investigational B-cell maturation antigen (BCMA)-directed chimeric antigen receptor (CAR) T cell immunotherapy - BUY
My version of the morning’s numbers is written to be informative; it’s what happened or will beyond the headline happen today, not tomorrow or yesterday.
Dow future are DOWN -1.21% (-226 points), S&P futures are DOWN -1.28% (-34 points) and NASDAQ futures are DOWN -0.86% (-68 points)
Stock futures “wings” were clipped as the market and sector tries to sustain share pricing in this period of a coronavirus pandemic;
European markets advanced following a positive lead set in Asia after Chinese manufacturing data rebounded in March with the pan-European Stoxx 600 climbing +1.7% in early trade;
Asia Pacific markets were mixed as China’s official manufacturing Purchasing Managers’ Index for March came in better than some analysts expected; while Japan closed lower, Australia closed down and South Korea led gains;
Data docket: China’s official manufacturing Purchasing Managers’ Index (PMI) for March came in better than some analysts expected. China said its official manufacturing PMI for March came in at 52.0, indicating an expansion and defying expectations of a contraction. Analysts had expected the figure to come in at 45 for the month. PMI readings below 50 signify a contraction, while figures above that level indicate an expansion.
Overnight action followed a strong session however, consensus cries for more selling before the market and “our” cell and gene therapy sector can reach a bottom to come back from.
Its about confidence and trust and we all know that answer … “There’s a struggle between trust and conviction. Trust is something you can rely on, beyond certainty. Conviction doesn't demand that others play by the rules with some principle of reliability.”
A BOTTOM is being assembled but, has not been established – just when you think your there; it slips away for a multitude of reasons – one is wait for fundamentals to be returned as a tool of pricing measurement.
Many traders, fund managers and any form of investor are calling for even more selling before the market can hit a bottom.
The BOTTOM LINE: build reserves from selling the short-term highs to build “powder” for future and better lower priced (oversold) positions
Monday night’s title: “the cell/gene therapy sector moves to the upside and stays there. Volatility has been offset by selling fatigue as reaction to bad news has deescalated than recent weeks setting an attitude for quarterly rebalancing portfolios as major averages are still below their moving-day averages.”
- the NASDAQ closed up +271.77 points (+3.62%);
- the VIX was down -8.46 points or -12.91% at 57.08;
- the IBB closed up +3.57% and XBI also closed up +2.05%;
- the range of the 20-upside was +1.45% (EDIT) to +37.54% (PSTI) while the 15-downside ranged from -0.38% (RGNX) to -9.52% (RENE.L);
- 5 out of the 20-upside had higher than the 3-month average volume;
- 4 out of the 15-downside had higher than the 3-month average volume;
- March registered 11 negative and 10 positive closes
- February registered 9 negative, 9 positive closes, 3 vacation days and 1 holiday.
- January registered 9 negative, 10 positive closes and 2 holidays.
- December registered 11 negative and 10 positive closes
- November registered 8 negative, 12 positive and 1 holiday closes;
- October registered 14 negative, 10 positive and 1 neutral closes;
Companies in my headlights – It’s your decision; I provide an idea and context:
My targets to SELL into strength and volume: some of Monday’s inclines could be Tuesday’s overbought …
- Pluristem (PSTI),
- Athersys (ATHX),
- Stemline Therapeutics (STML)
My targets to BUY:
- Intellia Therapeutics (NTLA) – news of this P1/2 clinical trial will begin investigating OTQ923 in adult patients with severe complications of SCD. OTQ923 is a SCD treatment based on genome editing of hematopoietic stem cells (HSCs), using CRISPR/Cas9 RNA guides identified through NTLAs cell therapy research collaboration with Novartis,
- Vericel (VCEL) – oversold;
- ReNeuron (RENE.L) with a +$3.00 pre-market indication, bluebird bio BLUE) closed down -$0.81 or -1.70% to $46.96 and has a +$1.24 or +2.64% pre-market indication
- bluebird bio (BLUE closed down -$0.81 to $46.96 and has a pre-market incline of +$1.24 or +22.64) has news of a submission of their Biologics License Application (BLA) to the U.S. FDA for idecabtagene vicleucel (ide-cel; bb2121), the companies’ lead investigational B-cell maturation antigen (BCMA)-directed chimeric antigen receptor (CAR) T cell immunotherapy, for the treatment of adult patients with multiple myeloma who have received at least three prior therapies, including an immunomodulatory agent, a proteasome inhibitor and an anti-CD38 antibody.
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.