March 31, 2020 6:12pm
The real question is how much end-of-quarter re-balancing is actually happening or we are back to outright machine-oriented selling
Pre-open indications: 4 HITs < PSTI (-$0.47), selling into strength: ATHX (+$0.41), STML (+$0.08), RENE.L (+$4.00)> and 3 MISS <NTLA (-$0.45), BLUE (-$1.00), VCEL (-$0.07)>
Market talk, ideas and opinions; Insight from a volatile climate; RMi outlines the preludes of a new week defining the mitigating factors of share pricing!
The Dow closed DOWN -410.32 points (-1.84%), the S&P closed DOWN -42.06 points (-1.60%) while the NASDAQ closed DOWN -74.05 points (-0.95%)
Indexes gyrated between gains and losses on Tuesday, the last day of Q1/2020, as investors hoped and wished to “wrap” a period of volatility sparked by the coronavirus COVID-19 pandemic.
In Q1, the Dow lost -23.2%, the S&P 500 -20% and the Nasdaq is set to retreat 9.5%. The Dow is on pace to have its worst Q1 in history.
- For the month, the Dow fell -13.7% and S&P 500 fell -12.5% and the NASDAQ -14%.
Cell and gene therapy equities flipped neutral on Tuesday, after four (4) ups in the last five (5) sessions as those considered “overbought” were stripped of value –it was just a matter of time before algorithms ‘ruled’ on profiteering of our assets.
- The sector’s Advance/Decline (A/D) line opened at 8/24 and 3 flats, jumped positive to the mid-day at 23/12, getting marginalized at 2:30 p.m. at 21/14 and closed neutral at 17/17 and 1 flat (AGTC) of the 35 covered companies.
Investors are digesting news that contribute to volatile swings along with the quarterly rebalancing of portfolios:
- New York Gov. Andrew Cuomo said coronavirus cases in the state jumped by 14% overnight to more than 75,000;
- Goldman Sachs said that the economy would go through an unprecedented plunge in Q2, but that the recovery would then be the fastest in history;
- Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases is starting to see “glimmers” that social distancing is helping to lessen the spread of the coronavirus in the U.S. <CNBC>
Sentiment and its indicators: better-than-expected economic data on U.S. consumer confidence
- The Chicago PMI came in at 47.8 for March, down from 49 in February estimate of 39, but above expectations of between 35 and 42;
- The Conference Board’s consumer confidence index fell to 120 in March from 130.7 in February - beating expectation of 115;
- the Case-Shiller home price index for January showed U.S. home prices rising 3.9% annually, before the U.S. economy began feeling the economic impact of the coronavirus;
- Data from China’s manufacturing and service sectors showed unexpectedly strong rebounds in March.
Volatility in the market is usually inversely correlated in the short-term. The CBOE Volatility Index (VIX) tracked:
- Tuesday was down -3.54 points or -6.20% at 53.54,
- Monday was down -8.46 points or -12.91% at 57.08,
- Friday was up +4.54 points or +7.44% to 65.54,
- Last week, the VIX eclipsed its financial crisis high, closing at 82.69.
Defining pandemic disruption: The number of confirmed U.S. coronavirus cases:
- surged on Tuesday to 177,452
- from Monday’s 153,200,
- Friday’s 97,028,
- Thursday’s 69,000,
- Wednesday’s 55,568 and
- last Tuesday’s 46,500
Tuesday’s death rate escalated to 3,440 after Monday’s 2,828 following Friday’s 1475, Thursday’s 1,000, Wednesday’s 809 following last Tuesday’s 590. <John Hopkins University>
Volume was LOW as 3 out of the 17-upside had higher than the 3-month average volume with even LOWER volume as only 2 out of the 17-downside had higher than the 3-month average volume.
- Versus Monday’s minimal volume of 5 out of the 20-upside having higher than the 3-month average volume with nominal volume as only 4 out of the 15-downside had higher than the 3-month average volume.
Tuesday’s percentage (%) statistics of the 17-upside while the 17-downside were lower:
- Monday’s percentage (%) statistics of the 20-upside were +1.45% (EDIT) to +37.54% (PSTI) while the 15-downside ranged from -0.38% (RGNX) to -9.52% (RENE.L) were a lot higher than usual.
Today’s upsiders stand-out –Athersys (ATHX) – 5th session, Stemline Therapeutics (STML) – 2nd session and a few others … RENE.L, QURE, VYGR, BLCM, ADRO, CLLS, PGEN, SLDB and AXGN to name a few.
While some downsiders hit a 2nd slide session – Regenxbio (RGNX), Adverum (ADVM), bluebird bio (BLUE), Ionis Pharmaceuticals (IONS) and Sage Therapeutics (SAGE)
The BOTTOM LINE: It’s being said that this is going to be a V-shaped recovery; I think it’s more of a U-shaped recovery; however, the risk of a recession in relative to unemployment and investments in public health being more than … high; and correlated to the coronavirus’ timetable of infection.
The RegMed sector has been more than a walk downhill. Electronic and machine-oriented trading have assaulted our confidence and trust.
- There just isn’t ANY headlines or we are barely receiving sector-oriented news to least keep investors interested to HOLD equities and possibly a BUY.
- A small piece of good news could mitigate company silence during a market’s precipitous declines which has sent shares diving to the newest of bottoms or running for the exits causing dramatic “violence” to share pricing and putting too many equities in play.
- We can’t avoid bad news (but, s**t happens), but there is no excuse for a RegMed company not communicating with its owners, especially when one considers the ease of communication via the internet and social media.
- A cursory review of RegMed web pages shows companies not bothering to keep this vital marketing, customer, and investor relations vehicle up to date.
- Not a great strategy for keeping your most important asset – investors … excited and confident about their investment.
- Nurture your investors, and they will stick and HOLD!
Check out the supporting data groupings and their numbers …
The iShares NASDAQ Biotechnology (IBB) and the SPDR S&P ETF (XBI) indicators:
- Tuesday, the IBB closed down -1.01% and XBI also closed down -0.76%
- Monday, the IBB closed up +3.57% and XBI also closed up +2.05%
- Friday, the IBB closed -1.95% and XBI also closed down -2.90%
The advance/decline line scenario of 35 covered companies:
- Tuesday, the close was neutral with an A/D line of 17/17, 1 flat of 35 covered;
- Monday, the close was positive with an A/D line of 20/15, 0 flat of 35 covered;
- Friday, the close was negative with an A/D line of 8/25, 2 flats of 35 covered;
Tuesday’s (top 10) incliners: review closely – there are patterns here after positive closes or negative closes – this week’s possible …!
- ReNeuron (RENE.L +$4.00 after Monday’s -$10.00);
- uniQure NV (QURE +2.41 after Monday’s +$0.78 and Friday’s -$0.69);
- Athersys (ATHX +$0.41);
- Voyager Therapeutics (VYGR +$0.40 after Monday’s -$0.30 and Friday’s +$0.11);
- Bellicum Pharmaceuticals (BLCM +$0.30 after Monday’s -$0.43, Friday’s +$0.27 and last Thursday’s -$0.05);
- Aduro Biotechnologies (ADRO +$0.22);
- Cellectis SA (CLLS +$0.15);
- AxoGen (AXGN +$0.15 after Monday’s +$0.92);
- Precision (PGEN +$0.14);
- Brainstorm Cell Therapy (BCLI +$0.13 after Monday’s -$0.39);
Tuesday’s (bottom 10) decliners: after positive closes or negative closes – this week’s possible …
- CRISPR Therapeutics (CRSP -$1.88 after Monday’s +$2.47, Friday’s -$2.17, Thursday’s +$2.21, Wednesday’s -$0.88 and last Tuesday’s +$3.21);
- Regenxbio (RGNX -$1.37 after Monday’s -$0.13 and Friday’s +$1.34);
- Adverum Biotech (ADVM -$1.22 after Monday’s -$0.44);
- bluebird bio (BLUE -$1.00 after Monday’s -$0.81, Friday’s +$1.20, Thursday’s -$0.75 and last Wednesday’s -$1.50);
- Fate Therapeutics (FATE -$0.95 after Monday’s +$0.98, Friday’s -$1.13, Thursday’s -$0.09, Wednesday’s -$0.50 and last Tuesday’s +$1.62);
- Global Blood Therapeutics (GBT -$0.95 after Monday’s +$0.92, Friday’s -$0.88);
- Ionis Pharmaceuticals (IONS -$0.93 after Monday’s -$1.20);
- Sage Therapeutics (SAGE -$0.78 after Monday’s -$2.00, Friday’s +$0.55, Thursday’s +$0.62, Wednesday’s +$0.97 and last Tuesday’s +$3.21);
- Homology Medicine (FIXX -$0.60 after Monday’s +$2.13 after Friday’s -$2.98 and Thursday’s +$1.08);
- Pluristem (PSTI -$0.47 after Monday’s +$1.13);
The percentage (%) indicators:
- Tuesday’s the range of the 17-upside was +0.02% (ALNY) to +15.83% (ATHX) while the 17-downside ranged from -0.76% (VCEL) to -11.35% (PSTI);
- Monday’s 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);
- Friday’s range of the 8-upside was +1.23% (VYGR) to +14.29% (BSTG +$0.50) while the 25-downside ranged from -0.24% (MESO) to -17.54% (FIXX);
Upside volume stats: key numbers
- Tuesday: 3 out of the 17-upside had higher than the 3-month average volume;
- Monday: 5 out of the 20-upside had higher than the 3-month average volume;
- Friday: 5 out of the 8-upside had higher than the 3-month average volume;
Downside volume stats:
- Tuesday: 2 out of the 17-downside had higher than the 3-month average volume;
- Monday: 4 out of the 15-downside had higher than the 3-month average volume;
- Friday: 4 out of the 25-downside had higher than the 3-month average volume;
1 flat – AGTC
March - amen, it's over
Tuesday closed neutral with 17 decliners, 17 advancer and 1 flat to end the month and quarter (Q1/2020);
Monday closed positive with 15 decliners, 20 advancer and 0 flat
Friday closed negative with 25 decliners, 8 advancer and 2 flats
Thursday closed positive with 7 decliners, 27 advancer and 1 flat
Wednesday closed positive with 12 decliners, 21 advancer and 2 flats
Tuesday closed positive with 3 decliners, 32 advancer and 0 flat
Monday closed negative with 20 decliners, 15 advancer and 0 flat
Friday closed negative with 23 decliners, 11 advancer and 1 flat
Thursday closed positive with 5 decliners, 30 advancer and 0 flat
Wednesday closed negative with 25 decliners, 10 advancer and 0 flat
Tuesday closed positive with 9 decliners, 26 advancer and 0 flat
Monday closed negative with 34 decliners, 1 advancer and 0 flat
Friday closed positive with 6 decliners, 29 advancers and 0 flat
Thursday closed negative with 33 decliners, 2 advancers and 0 flat
Wednesday closed negative with 32 decliners, 2 advancers and 1 flat
Tuesday closed positive with 10 decliners, 24 advancers and 1 flat
Monday closed negative with 32 decliners, 3 advancers and 0 flats
Friday closed negative with 29 decliners, 4 advancers and 2 flats
Thursday closed negative with 24 decliners, 11 advancers and 2 flats
Wednesday closed positive with 3 decliners, 30 advancers and 2 flats
Tuesday closed negative with 26 decliners, 7 advancers and 2 flats
Monday closed positive with 11 decliners, 24 advancers and 0 flats
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.