July 16, 2020 7:53am
Pre-open indications: 1 BUY and 6 SELLs
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Dow futures are DOWN -0.57% (-153 points), S&P futures are DOWN -0.60% (-19 points) and NASDAQ futures are DOWN -1.22% (-131 points)
U.S. stock futures are down starting Thursday’s session with investors listening-in earnings calls and big losses in Asia shares overnight;
European stocks traded in negative territory with the pan-European Stoxx 600 slid 1% by mid-morning;
Asia Pacific stocks were lower as the Shanghai composite dropped more than 4% with japan, South Korea and Australia also following along as the MSCI Asia ex-Japan index fell 1.8%.
- China ’s GDP grew by 3.2% in Q2 as compared to a year ago. That was higher than expectations of a 2.5% growth in the April to June quarter by economists while retail sales in June fell 1.8% on-year, falling short of expectations of a 0.3% growth by analysts.
Data Docket: The weekly jobless claims number came in slightly worse than expected. The Labor Department said a total of 1.30 million Americans filed for unemployment benefits last week, compared to Dow Jones estimates of 1.25 million first-time filers.
- Retail sales jumped 7.5% in June, topping expectations of a 5.2% increase. This reading came after May’s 17.7% surge, which blew past estimates and was the largest reading on record.
- The EU awaits the latest monetary policy decision from the European Central Bank, although the bank is not expected to announce any policy changes.
Henry’omics:
Thursday’s moves came following a major sell-off in mainland Chinese stocks, which saw the Shanghai composite down more than 4% on the day. That came despite China reporting that the country’s GDP grew 3.2% in the second quarter of the year as compared to a year ago — above expectations of a 2.5% growth by economics in a Reuters poll.
Wednesday night’s post title - a recap: “Moderna (MRNA) vaccine stimulates immune system, optimism, sector and markets. Every sector stock is a trade; warning, sector Q2 earnings LPS (loss-per-share) results are looming.”
- The NASDAQ closed UP +61.92 points (+0.59%);
- The IBB closed up +1.68% and XBI also closed up +2.13%;
- Sector volume was LOW with 3 of the 30-upside having higher than the 3-month average volume and 2 out of the 4-downside having higher than the 3-month average volume;
- The CBOE Volatility Index (VVIX: INDEX) was down -1.76 points or -5.96% at 27.76;
- Wednesday’s percentage (%) of the 30-upside were +0.08% (BCLI) to +7.37% (CLLS) while the 4-downside ranged from -0.70% (MDXG) to -17.33% (CLBS);
Q3’s last five (5) sessions:
Wednesday closed positive with 30 advancers, 4 decliners and 1 flat
Tuesday closed positive with 25 advancers, 8 decliners and 2 flats
Monday (7/13) closed negative with 4 advancers, 29 decliners and 2 flats
Friday closed negative with 9 advancers, 22 decliners and 4 flats
Last Thursday closed negative with 10 advancers, 24 decliners and 1 flat
Companies in my headlights – It’s your decision; I provide an idea and context:
Maintaining Sell:
Biostage (BSTG) closed up +$0.01 after Tuesday’s -$0.02 with 3,610 shares traded after Friday’s +$0.02 to $2.52 with 25 shares traded on Friday after Thursday’s +$0.02, Wednesday’s -$0.01 and last Tuesday’s -$0.09; serious questions of transparency, ethics, lack of experienced management talent and loss of executive team. BSTG trades ONLY with day traders, NO institutions or major firms. The real issues are the amounts of outstanding private placement shares sold to Chinese nationals with warrant coverage. After an IND approval, WHY hasn’t a clinical trial begun – BROKE;
SELL into Strength:
Alnylam Pharmaceutical (ALNY) closed up +$0.79 after Tuesday’s -$0.155 to $2.65 and has a negative -$0.72 or -.0.46% aftermarket indication;
Editas Medicine (EDIT) closed up +$1.00 or 5.43% to $90.91 after Monday’s -$3.20 or -3.62% and has a negative -$0.56 or -1.72% aftermarket indication;
CRISPR Therapeutics (CRSP) closed up +$2.41 to $93.32 after Tuesday’s +$4.68 and Monday’s -$3.24) with a 52-week change of +84.63. time to lighten the load and take a few dollars off the table;
Pluristem (PSTI) closed up +40.45 to $8.85 and has a negative -$0.05 or -0.56% aftermarket indication;
Sage Therapeutics (SAGE) closed up +$1.60 to $45.25 and has a negative -$0.42 or -0.93% aftermarket indication;
BUY:
BioLife Solutions (BLFS) closed up +$0.73 to $19.94 and has a positive +$1.10 or +5.54% aftermarket indication after providing an update on adoption of its evo cold chain management platform solution by cell and gene therapy companies. Via its relationships with leading specialty couriers World Courier and Quick International Courier, the evo platform is used to transport and monitor shipments of source material and manufactured doses in more than 100 cell and gene therapy clinical trials;
The BOTTOM LINE: The economy is trying to re-open but, many companies (i.e. airlines) are laying employees off in the thousands
Some “pundits” proclaim “the end of the month could also mean the end of the rally”.
The Nasdaq has come to unequivocally exemplify the unmitigated surge from the equity market’s March 23 lows, even as the economy is reeling from the effects of a pandemic that appears out of control in a number of U.S. states. The Nasdaq is up 53% from that March low, while the Nasdaq-100 has rallied by about 53%.
A volatility gauge, the CBOE NASDAQ Volatility Index (VXN) “reflects expectations for coming volatility in a benchmark and tend to rise as the underlying index falls, it is rare to see them move in tandem”. <MarketWatch>
- The VXN is a measure of market expectations of 30-day volatility for the Nasdaq-100 index, as implied by the price of options on this index.
SELL into multiple sessions of strength or a dramatic incline in pricing … the early bird gets the worm even, sometimes by folding, a few bucks get left on the table – take the “pot” while and if you have it.
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.
