May 13, 2020 5:14pm
As the Fed’s chair Powell warns of “downside risks”, which I have been touting for weeks; which also opens an opportunity to BUY as one moves past the slippage … s l o w l y. Think of the “limbo” dance, how low will they go before a re-entry
Pre-open indications follow-up: 9 HITs < CRISPR Therapeutics (CRSP -$2.18), bluebird bio (BLUE -$1.04), Global Blood Therapeutics (GBT -$2.77), uniQure NV (QURE -$4.43), Fate Therapeutics (FATE -$1.31), Vericel (VCEL -$0.36), Sangamo Therapeutics (SGMO -$0.19), ReNeuron (RENE.L -$13.50), Athersys (ATHX +$0.04) and 2 MISS < Editas Medicine (EDIT -$0.97), BioLife Solutions (BLFS -$0.33)>
An “intelligence newspaper” for smart investing in the RegMed, gene and cell therapy sector. Check the BOTTOM LINE <read more>
The Dow closed DOWN -516.81 points (-2.17%), the S&P closed DOWN -50.12 points (-1.75%) while the NASDAQ closed DOWN -139.38 points (-1.55%)
Indexes splattered on Wednesday as investors grappled with downbeat remarks from the top-ranking Fed chair Powell amid jitters about reopening the economy along with worries over the market’s valuation.
- “While the economic response has been both timely and appropriately large, it may not be the final chapter, given that the path ahead is both highly uncertain and subject to significant downside risks,” he said. Powell added, however, the economy should see a substantial recovery once the coronavirus is under control.
A history lesson from 2020, “the Dow slid more than 34% through the March 23 close. The Nasdaq fell 23.5%, while the S&P 500 declined 30.7% through the March 23 close. After a sharp rally in April — the Dow 30 gained more than 11% for the month— the Dow is down 14.7% in 2020. Meanwhile, the S&P 500 is down 9.9% and the Nasdaq is down -0.9% through the April 30 close.” <Investor’s Business Daily>
Mesoblast (MESO) blasted through the upside wall on news of a financing and manufacturing of a stem cell-based therapy; a whole lot of shares (43 million) to absorb with 107 million outstanding and a float of 81.74 million; never forget the Hercules ATM debt vehicle.
The sector bounced through the morning opening and settled negative at the mid-day as the “machines” reaped the “vig” from the highs.
Volume INCREASED with 2 out of the 3-upside having higher than the 3-month average volume and remained LOW with 11 out of the 31-downside having higher than the 3-month average volume. The percentage (%) of the 3-upside were +0.70% (MDXG) to +6.67% (MESO) while the 31-downside ranged from -0.37% (STML) to -8.61% (CLLS).
Hammered in today’s market:
- ReNeuron (RENE.L), uniQure NV (QURE), Alnylam Pharmaceuticals (ALNY), Regenxbio (RGNX), Global Blood Therapeutics (GBT), CRISPR Therapeutics (CRSP) and to name a few of the 34 of the 35 covered
Jumping with momentum:
- Mesoblast (MESO), MiMedx (MDXG) and Athersys (ATHX) to name three of the only three
Q1/2020 results will be disseminated through RegMed Earnings Scorecard - Q1/20 - to date https://www.regmedinvestors.com/articles/11332 - 25 of 35 so far …
The iShares NASDAQ Biotechnology (IBB) and the SPDR S&P ETF (XBI) indicators:
- Wednesday, the IBB closed down -1.11% and XBI also closed down -1.99%
- Tuesday, the IBB closed down -2.13% and XBI also closed down -2.16%
- Monday, the IBB closed up +4.28% and XBI also closed up +4.77%
The CBOE Volatility Index (VVIX: INDEX) tracked:
- Wednesday was up +1.89 points or +5.60% at 34.84,
- Tuesday was up +5.47 points or +19.84% at 33.04,
- Monday was down -0.41 points or -1.47% at 27.57,
RegMed/Cell and gene therapy 35 covered equities’ Advance/Decline (A/D) lines: progressions and regressions
- Wednesday opened negative at 10/23 and 2 flats, stayed negative at the mid-day at 2/32 and 1 flat and closed negative at 3/31 and 1 flat;
- Tuesday opened negative at 5/28 and 2 flats, popped positive at the mid-day at 25/8 and 2 flats and closed negative at 11/21 and 3 flats;
- Monday opened positive at 17/14 and 4 flats, stayed positive at the mid-day at 24/9 and 2 flats and closed positive at 24/9 and 2 flats;
Wednesday’s (only 2) incliners:
- Mesoblast (MESO +$0.76);
- Athersys (ATHX +$0.04)
- MiMedx (MDXG +$0.025);
Wednesday’s (bottom 10) decliners:
- ReNeuron (RENE.L -$13.50 after Tuesday’s -$1.50, Monday’s -$7.00, Friday’s +$20.00 and last Thursday’s +$25.00;
- uniQure NV (QURE -$4.55 after Tuesday’s +$0.86;
- Alnylam Pharmaceuticals (ALNY -$4.53 after Tuesday’s +$1.76, Monday’s +$6.30, Friday’s -$5.32, Thursday’s -$3.82, Wednesday’s +$4.04 and last Tuesday’s +$5.27);
- Regenxbio (RGNX -$3.05 after Tuesday’s -$0.96, Monday’s +$2.40 after Friday’s -$1.87);
- Global Blood Therapeutics (GBT -$3.40, Tuesday’s -$3.14 after Monday’s -$0.20, Friday’s -$0.19, Thursday’s -$4.38, Wednesday’s +$2.50 and last Tuesday’s +$1.62);
- Ultragenyx (RARE -$2.22 after Tuesday’s -$1.07, Monday’s +$3.52, Friday’s +$0.72, Thursday’s -$3.14, Wednesday’s +$1.58 and last Tuesday’s -$0.04);
- CRISPR Therapeutics (CRSP -$2.08 after Tuesday’s -$1.74 and Monday’s +$7.45);
- Sage Therapeutics (SAGE -$1.96 after Tuesday’s -$1.84);
- Adverum Biotechnologies (ADVM -$1.53 after Tuesday’s `-$0.99 after Monday’s -$0.29);
Percentage (%) movement/range statistics: look closely …
- Wednesday’s % of the 3-upside were +0.70% (MDXG) to +6.67% (MESO) while the 31-downside ranged from -0.37% (STML) to -8.61% (CLLS);
- Tuesday’s % of the 11-upside were +0.41% (STML) to +8.78% (CLBS) while the 21-downside ranged from -0.42% (MDXG) to -13.46% (BLCM);
- Monday’s % of the 24-upside were +0.33% (SAGE) to +15.14% (ATHX) while the 9-downside ranged from -0.12% (STML) to -4.22% (RENE.L);
Sentiment and a few daily indicators:
Dow sheds 2% as markets digest Fed’s grim outlook for economy as stated, “The scope and speed of this downturn are without modern precedent, significantly worse than any recession since World War II …” Fed chairman Powell.
- And he further stated, “The recovery may take some time to gather momentum and the passage of time can turn liquidity problems into solvency problems.”
The Fed spun the web, traders dug a hole and we jumped in digging deeper, the key is getting up and out by stepping-on each other’s shoulders.
The number of confirmed U.S. coronavirus cases: every day I get sadder as I post these numbers …
- Wednesday 1.3 million,
- Tuesday 1.3 million,
- Monday 1.3 million,
Wednesday’s death rate escalated to a total of 82,806 after Tuesday’s 80,897 and Monday’s 79,894 <John Hopkins University>
Upside volume stats:
- Wednesday: 11 out of the 32-upside had higher than the 3-month average volume;
- Tuesday: 8 out of the 11-upside had higher than the 3-month average volume;
- Monday: 12 out of the 24-upside had higher than the 3-month average volume;
Downside volume stats:
- Wednesday: 2 out of the 3-downside had higher than the 3-month average volume;
- Tuesday: 9 out of the 21-downside had higher than the 3-month average volume;
- Monday: 2 out of the 9-downside had higher than the 3-month average volume;
Closing flat: Biostage (BSTG)
Wednesday closed negative with 31 decliners, 3 advancer and 1 flat
Tuesday closed negative with 21 decliners, 11 advancer and 3 flats
Monday (5/11) closed positive with 9 decliners, 24 advancer and 2 flats
Friday closed positive with 12 decliners, 20 advancer and 3 flats
Thursday closed negative with 22 decliners, 11 advancer and 2 flats
Wednesday closed positive with 13 decliners, 20 advancer and 2 flats
Tuesday closed positive with 10 decliners, 25 advancer and 0 flats
Monday (5/4) closed positive with 7 decliners, 28 advancer and 0 flats
Friday (5/1) closed negative with 25 decliners, 8 advancer and 2 flats
The BOTTOM LINE: We have a market and a dependent sector just waiting to see how the economy opens and quarterly results are completed and swept from view.
The real question is WHAT catalysts are in the short-term future?
It’s not hard to be right so often, it’s about refining expectation, defining insight and NOT being indentured to ANY financial institution!
So, if you think you understand sentiment and its perception, think again and then again.
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.