May 28, 2020 8:40am
Fits our current expectations, slightly dangerous and/or uncertain
Pre-open indications: 3 BUYs and 4 SELLs
Q1 quarterly results: Adverum Biotechnologies (ADVM) and Q3 and nine (9) month for Mesoblast (MESO)
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Dow future are UP +0.63% (+162 points), S&P futures are UP +0.08% (+3 points) and NASDAQ futures are DOWN -0.98% (-89 points)
Futures fluctuated early Thursday as investors dreamed about market gains;
European stocks traded modestly higher against a backdrop of rising tensions between the U.S. and China as the pan-European Stoxx 600 climbed 0.7% in early trade;
Stocks in Asia Pacific were mixed as mounting U.S.-China tensions weighed on investor sentiment. Japanese stocks led gains, Hong Kong and South Korea slipped while Mainland China were mixed and Australia jumped with the MSCI Asia ex-Japan index was fractionally lower.
Data docket: The Department of Labor released the latest update to initial jobless claims - Weekly jobless claims total 2.123 million, vs 2.05 million estimate and GDP was down -5%
- Last week, the Labor Department reported another 2.44 million Americans had filed claims in the week ended May 16, which brought the coronavirus crisis total to some 38.6 million, by far the largest loss in U.S. history.
Check the box, questionable about today!
Investors will be keeping an eye on developments in an escalating war of words between the U.S. and China, with trade, the coronavirus pandemic and now Hong Kong a focus in the dispute.
- Gains were kept in check after China’s National People’s Congress approved a national security bill for Hong Kong. The bill will bypass Hong Kong’s legislature, raising concerns over the longevity of Hong Kong’s “one party, two systems” principle, which allows additional freedoms mainland China does not have. <CNBC>
The broader indexes were up: S&P 500 (+2.7%), Nasdaq (+0.09%) and Dow (+4.4%) since the start of the holiday-shortened week.
Mesoblast (MESO) Q3/2020 and nine (9) month results highlights:
Mesoblast (MESO) reported financial, corporate and operational highlights for the nine months ended March 31, 2020. Cash on hand at March 31, 2020 was US$60.1 million (A$97.3 million) and in May 2020, pro forma cash on hand was approximately US$150 million (A$235 million) after adjusting for a US$90 million (A$138 million) capital raise;
- Its Biologics License Application (BLA) for marketing approval of RYONCILTM (remestemcel-L) in children with steroid-refractory acute graft versus host disease is currently under priority review by the United States FDA;
- 113% increase in revenues;
- A Q3/2020 net loss of -$15.2 million or -$2.84 per share and a 9-month loss of -$45.3 million or -$8.66 per share;
Financing costs grew for their borrowing arrangements with Hercules and NovaQuest were US$9.8 million for the nine months of FY2020, compared to US$7.9 million for the nine months of FY2019, an increase of US$1.9 million.
Wednesday post’s title: “rotation to the upside as the session closed on the verge of what? Don’t bet your portfolio on enthusiasm! Trends flip-flop, selling the open and buying the close has gained energy while holding overnight causes agita, always anticipate reversals.”
- The NASDAQ closed UP +72.14 points (+0.77%);
- Wednesday opened negative at 11/23 and 1 flat, stayed negative at the mid-day at 13/22 and closed positive at 20/15;
- Volume was increased with 4 out of the 20-upside having higher than the 3-month average volume and 5 out of the 15-downside having higher than the 3-month average volume.
- Wednesday’s percentage (%) of the 20-upside were +0.14% (IONS) to +4.62% (SGMO) while the 15-downside ranged from -0.08% (STML) to -8.73% (FIXX);
- The IBB closed up +0.91% and XBI also closed up +0.03%;
- May registered 8 negative, 10 positive closes – so far
- April registered 10 negative, 11 positive closes and 1 holiday.
- March registered 11 negative, 10 positive closes and 1 neutral close.
- February registered 9 negative, 9 positive closes, 3 vacation days and 1 holiday.
- January registered 9 negative, 10 positive closes and 2 holidays.
Companies in my headlights – It’s your decision; I provide an idea and context
- Applied Genetic Technologies (AGTC) closed up +$0.01 after Tuesday’s +$0.42, Friday’s +$0.12 to $4.60 and last Thursday’s +$0.13. AGTC’s spikes usually get taken down by trading but, it has been oversold too long with NO aftermarket indication. It will go either way;
- bluebird bio (BLUE) closed down -$2.24 after Tuesday’s -$2.87 and has a positive +0.87 or +1.41% aftermarket indication. BLUE seems to bounce after a hammering in many cases;
- Sangamo Therapeutics (SGMO) closed up +$0.51 after Tuesday’s -$0.58 and has a positive +$0.05 or +0.58% aftermarket indication;
- uniQure NV (QURE) closed up +$1.54 after Tuesday’s +$0.35, Friday’s +$0.92 and last Thursday’s +$2.62) and has a negative -$1.70 or -2.60% aftermarket indication. MAY 1st opened at $59.03, bounced up and down with May 14th low of $56.32, a target of trading;
- Adverum Biotechnologies (ADVM) closed up +$0.58 to $21.02 and reports Q1 today with a positive +$0.03 or +0.14% aftermarket indication. Let’s not get ahead of ourselves, a 52-week change of +114.71%, a chart that seems “peaky”, and finally a share price that opened may 1st at $12.00 – there’s a squeeze on the way;
- Bellicum Pharmaceuticals (BLCM) closed up +$0.10 and has a negative -$0.20 or -2.71% aftermarket indication and a share price of $4.56 that started May 1st;
- Mesoblast (MESO) closed up again +$0.21 after Tuesday’s +$0.32 and has a negative -$0.20 or -1.52% aftermarket indication. Q3 and 9-month results were capped by a “raise” and filing of a BLA in the US however, their borrowing costs were elevated by +$1.9 million;
The BOTTOM LINE: trend lines are bent, not totally broken but, sharply curved and/or having an angle.
A trendline is a line drawn over pivot highs or under pivot lows to show the prevailing direction of price. Trendlines are a visual representation of support and resistance in any time frame. They show direction and speed of price changes, and also describe patterns during periods of price contraction
The current issue is the time period being analyzed … key word is “current”. I don’t use “candlesticks”; I find an old zippo lighter is more apropos in determining direction!
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.