July 22, 2020 7:57am

Don’t shove the portfolio in the draw; play it, rotate or submit to the algorithm’s “rules”

Pre-open indications: 5 BUYs and 4 SELLs

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

Subscription is coming, it’s not conscription but, an offer to join our collective of like-minded investors who make money and for those who read and don’t weep!

 

Dow futures are DOWN -0.22% (-58 points), S&P futures are DOWN -0.15% (-5 points) and NASDAQ futures are UP +0.19% (+21 points)

 

U.S. futures imply a lower open;

European stocks were down as the pan-European Stoxx 600 slipped 1% in early trade;

Asia Pacific stocks mostly declined, but mainland Chinese stocks rose with the MSCI’s broadest index (outside Japan) edged down -0.17% in the afternoon.

Data Docket: Existing home sales are expected to rebound to 4.73 million sales for June will be released at 10 a.m.

 

Henry’omics:

Morning headline news, U.S. government taps Pfizer (PFE) to produce millions of doses of coronavirus vaccine and the US state department ordered the closure of China's consulate in Houston in order to protect American intellectual property and American's private information.

 

Tuesday night’s post title - a recap: “sector gets reaped and threshed after an overbought session as I stated this a.m., “Is the gain to be harvested?” It was … “

  • The NASDAQ closed DOWN -86.73 points (-0.81%);
  • The IBB closed down -2.29% and XBI also closed down -2.08%
  • Sector volume was LOW with 6 of the 10-upside having higher than the 3-month average volume and 4 out of the 24-downside having higher than the 3-month average volume;
  • The CBOE Volatility Index (VVIX: INDEX) was up +0.38 points or +1.55% at 24.84;
  • Tuesday’s percentage (%) of the 10-upside were +0.06% (FIXX) to +2.67% (MESO) while the 24-downside ranged from -0.33% (BSTG) to -6.88% (EDIT); 

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

  • Tuesday closed negative with 10 advancers, 24 decliners and 1 flat
  • 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
  • Last Wednesday closed positive with 30 advancers, 4 decliners and 1 flat

 

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

Maintaining Sell:

Biostage (BSTG) closed down -$0.01 after Tuesday’s +$0.10

  • After an IND approval, WHY hasn’t a clinical trial begun? – they’re BROKE and still filing 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? She was informed in many e-mails and individual face-to-face meetings yet ultimately; she condoned the continuing ethical issues within the company. The Chairman, Jason Chen <oversees the self-inflicted wounds from Beijing, China> works for her husband, also in China and the BSTG president is her neighbor.  So, where is the OVERSIGHT and biotech experience? We NEED regulators to step in …?

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

Maintaining SELL into Strength:

BioLife Solutions (BLFS) closed up +$0.42 to $21.3 after Monday’s +$1.46 or +7.47% to $21.01 with a 52-week high of $21.18 and low of $7.37. chart looks “peaky” and has a negative -$0.25 or -1.18% aftermarket indication;

Fate Therapeutics (FATE) closed down -$1.11 to $33.83 after Monday’s $34.94 and Friday’s $34.40 but, has a negative -$0.23 or -0.68% aftermarket indication;

CRISPR Therapeutics (CRSP) closed down -$1.75 to $93.55 after Monday’s +$2.95, Friday’s +$1.03 after Thursday’s -$2.00 and last Wednesday’s +$2.41. CRSP has a positive +$0.43 or +0.46% aftermarket indication;

Maintaining BUY:

Applied genetic Technologies (AGTC) closed down -$0.16 to $5.85 and has a positive pre-market +$0.20 or +3.42% pre-market indication following early news of “next steps in the clinical development of potential treatment of X-linked retinitis pigmentosa (XLRP) caused by mutations in the RPGR gene following receipt of written feedback from the FDA. The revised development plan, which includes immediate expansion of the current trial in parallel with the planned P2/3 trial, will be designed to evaluate sustained efficacy across multiple measures of potential benefit in patients with XLRP.’ AGTC remains on track to provide multiple data readouts for both its XLRP and ACHM clinical programs in the second half of 2020.  These readouts will include data from the two higher dose groups in the XLRP P1/2 trial.

Alnylam Pharmaceuticals (ALNY) closed own -$7.46 to $158.03 and has a positive +$2.87 or +1.81% aftermarket indication;

Mesoblast (MESO) closed up +$0.32 to $12.30 after Monday’s $11.98 and Friday’s $11.61 but, has a positive +$0.50 or +4.07% aftermarket indication;

Vericel (VCEL) closed down again -$0.31 to $15.95 after Monday’s -$0.16 and has a positive +$0.40 or +2.48% aftermarket indication;

Pluristem (PSTI) closed down -$0.57 to $8.88 after Monday’s up +$0.65 and has a positive +$0.11 or +1.24% 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: I’m also NOT a “risk-on” fan … up, down, round and round – we’re solidly into ‘overs … overbought and then oversold to spin-up sometimes reversing the “curse’ of declines.

I’d be reducing RISK, a four-letter expletive in this sector and … I’d stop chewing the “bubble” gum of this market. In a way I’m advising “pin-prick” raids on highs – hit and run with profits of highs!

Is the stock market a bubble waiting to burst? That is the question that some strategists and investors are considering as the U.S. equity market enjoys a run-up of at least 40% from the March lows, even as the economic picture, albeit an improving one, is currently looking unlikely to see a quick rebound from the COVID-19 pandemic. <MarketWatch>

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