July 21, 2020 7:59am

Is the gain to be harvested?

Pre-open indications: 2 BUYs and 4 SELLs <further Biostage (BSTG) questions for analysis>

What I provide is an intelligence daily. Where are the canaries in the sector coal mine, am I the only one? 

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Dow futures are UP +0.72% (+193 points), S&P futures are UP +0.81% (+26 points) and NASDAQ futures are UP +0.86% (+94 points)

 

Stock futures pointed to opening gains on Tuesday;

European stocks advanced after European Union (EU) leaders reached a deal to help the region recover from the coronavirus crisis as the pan-European Stoxx 600 climbed +1.1% in early trade;

Asia Pacific markets rose after investor sentiment was supported by a slew of positive news on the coronavirus vaccine front and from a pivotal European recovery fund.

 

Data Docket: 27 European Union (EU) members states reached an agreement on the of €750 billion ($857 billion) stimulus package to help the EU get back on its feet economically after the devastating coronavirus pandemic. The leaders also signed off on a seven (7) year budget for the bloc of over €1 trillion ($1.145 trillion)

 

Henry’omics:

The overnight action followed a strong performance in technology and RegMed, cell and gene therapy shares on Monday that pushed the Nasdaq up 2.5%.

Monday night’s post title - a recap: “early positive vaccine’s immune response data and The Lancet (peer reviewed med journal) news motivates market upside”

  • The NASDAQ closed UP +263.90 points (+2.51%);
  • The IBB closed up +1.28% and XBI also closed up +1.36%
  • Sector volume was LOW with 6 of the 24-upside having higher than the 3-month average volume and 0 out of the 10-downside having higher than the 3-month average volume;
  • The CBOE Volatility Index (VVIX: INDEX) was down -1.22 points or -4.75% at 24.46;
  • Monday’s percentage (%) of the 24-upside were +0.23% (VYGR) to +8.07% (FIXX) while the 10-downside ranged from -0.13% (IONS) to -4.98% (ADVM); 

Q3’s last five (5) sessions: pattern or trend?

  • Monday (7/20) closed positive with 24 advancers, 10 decliners and 1 flat
  • Friday closed positive with 24 advancers, 9 decliners and 2 flats
  • Thursday closed negative with 7 advancers, 25 decliners and 3 flats
  • Wednesday closed positive with 30 advancers, 4 decliners and 1 flat
  • Tuesday closed positive with 25 advancers, 8 decliners and 2 flats
  • Last Monday (7/13) closed negative with 4 advancers, 29 decliners and 2 flats

 

Companies in my headlights – It’s your decision; I provide an idea and context:

Maintaining Sell:

Biostage (BSTG) closed up +$0.10 after Friday’s -$0.05, Thursday’s +$0.21, Wednesday’s +$0.01, and last Tuesday’s -$0.02.

$806.00 in the bank - further funding needed, the real issues are the amounts of outstanding private placement shares sold to Chinese nationals with warrant coverage (little is left).

A special call-out to those who think they can CON the FDA, their bank over their PPP award after a $1 million fund raise (warrant execution), the SEC in filings of Q’s and K’s review of outstanding liabilities, where is the accounting for monies billed which remain owed re a $1 million gift to Connecticut Children’s (hospital) – does the FDA KNOW (?) and the Massachusetts Secretary of State’s Enforcement Division concerning the stock’s pricing movements.

  • BSTG trades ONLY with day traders, NO institutions or major firms.

After an IND approval, WHY hasn’t a clinical trial begun? – BSTG is BROKE and they have NOT totally filed follow-on and requested studies by the FDA.

Just part of the upcoming “story” – especially significant could be the role that Mrs. Bin Zhou of DST Capital (Weston, Mass) is playing as the major shareholder, shouldn’t she be held accountable by public shareholders and regulatory agencies? The Chairman, Jason Chen, works for her husband and the BSTG president is her neighbor?

Questions need answers … what exists are serious questions of transparency, ethics and the lack of experienced management talent.

 

SELL into Strength:

BioLife Solutions (BLFS) closed up +$1.46 or +7.47% to $21.01 with a 52-week high of $21.18 and low of $7.37. chart looks “peaky”;

CRISPR Therapeutics (CRSP) closed up +$2.95 to $95.30 after Friday’s +$1.03 after Thursday’s -$2.00, Wednesday’s +$2.41 and last Tuesday’s +$4.68 following the previous Monday’s -$3.24). CRSP has a positive +$0.34 or +0.36% aftermarket indication;

bluebird bio (BLUE) closed up +$1.31 after Friday’s -$0.39 after Thursday’s +$0.72, Wednesday’s +$3.08, last Tuesday’s +$2.12 and the previous Monday’s -$3.28. BLUE has a negative -$3.80 or -5.63% aftermarket indication;

BUY:

Vericel (VCEL) closed down -$0.16 to $16.26 and has a positive +$0.04 or +0.25% aftermarket indication;

Pluristem (PSTI) closed up +$0.65 or +7.39% to $9.45 and has a positive +$0.23 or +2.43% pre-market indication after the CEO Yaky Yanay issues shareholder update on clinical programs … https://finance.yahoo.com/news/pluristem-ceo-issues-shareholder-clinical-111010726.html

 

 

The BOTTOM LINE: New highs scare me - I am betting on a rotation of sector equities, the see-saw of closings, the IBB (UP +4.69%) and XBI’s (UP +4.64%) reaching all-time highs, low volume, Advance/Decline lines, sentiment indicators) numbers I say project … CAUTION.

We all want a safe and effective vaccine for the coronavirus. Certainly, one or more effective vaccines will be good for the economy.

Don’t let the early clinical data fool you…

However, ask the question, if the stock market is directing from the economy; “how will the stock market react to the actual time to immunize vaccines and when or over what period of time will a treatment be forthcoming and then consider the debt that has been accumulated by the COVID-19 pandemic?

Q2 sector results should start appearing in the first week of August … AxoGen (AXGN -8/5), Athersys (ATHX - 8/10) and Sage Therapeutics (SAGE – 8/10).

They will also be a litmus test of sector share pricing … challenging will be a key word!

 

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.