August 27, 2020 7:57am
Indications and warnings and alarms have been resounding since March; the Fed will define the short and near-term …
Pre-open indications: 5 BUYs and 2 SELLs
News: the U.S. FDA has cleared an Expanded Access Program (EAP) for the use of its PLX-PAD cells to treat Acute Respiratory Distress Syndrome (ARDS) caused by COVID-19 and the Biostage (BSTG) Chronicles <Read more>
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Dow futures are DOWN -0.25% (-72 points), S&P futures are DOWN -0.22% (-8 points) and NASDAQ futures are DOWN -0.15% (-18 points)
Index futures are dependent today upon an upcoming address from Federal Reserve Chairman Powell;
European markets traded negative and the pan-European Stoxx 600 index opened +0.01% higher before dipping into negative -0.3% territory;
Asia Pacific stocks mixed as China’s industrial profits jump as he MSCI Asia ex-Japan index rose 0.15%.
Data Docket: Just over 1 million people filed for first-time unemployment benefits last week after more than 1.1 million new claims the prior week. The Commerce Department reported a slight improvement in its second look at Q2 gross domestic product: An economic contraction of -31.7% versus -32.5% decline expected
- Fed chief Powell is expected to acknowledge that ongoing inflation shortfall and announce that the Fed will now have an “average inflation” target. Investors say that the move will allow the Fed to be more comfortable with inflation creeping above the 2% threshold so long as it’s eventually offset by periods of below-average price growth.
Thursday’s trading is likely to be driven in large part by comments from Fed Chair Jerome Powell, who is expected at 9:10 a.m. ET to introduce a new pandemic-era tool to combat the economic impact of Covid-19 and foster inflation in the U.S. The Fed’s annual symposium will be held virtually this year instead of the usual locale of Jackson Hole, Wyoming.
The central bank has for years tried to keep inflation at 2%, a rate of price increase that policymakers consider both manageable and indicative of a healthy economy. <CNBC>
Wednesday night’s post title – “the sector exhibits a falling knife which can be translated to mean, "wait for the price to bottom out before buying” as value is stripped after rising one (1) and falling five (5) sessions’
- The NASDAQ closed UP +198.59 points (+1.73%);
- The IBB closed down -0.17% and XBI also closed down -1.24%;
- Sector volume was LOW with 2 of the 8-upside having higher than the 3-month average volume and the 2 of 25-downside having higher than the 3-month average volume;
- The CBOE Volatility Index (VVIX: INDEX) was up +1.24 points or +5.63% at 23.27;
- Wednesday’s percentage (%) of the 8-upside were +0.49% (PSTI) to +21.43% (BSTG) while the 25-downside ranges from -0.01% (CRSP) to -6.05% (SAGE);
Q3 so far:
- August, 7 positive closes and 11 negative closes
- July -11 positive and 11 negative closes with 1 holiday
Companies in my headlights – It’s your decision; I provide an idea and context:
Biostage (BSTG) closed up +$0.30 to $1.70 (with 8998 shares traded) after Tuesday’s flat at $1.40 (1465 shares traded), Monday’s -$0.22 to $1.40, Friday’s +$0.29 to $1.62 and last Thursday’s +$0.16,
Keep “PUMPING” the share purchases – it’s costing you more and the less goes to the operations of the company.
There still exist the millions of private placement unregistered shares (priced at $3.20, $3.60, $3.70 and now $4.00) existing FAR beyond the registered outstanding and float shares. SO again, why are companies with ‘going concerns”, measured by continual losses, development failures, a filed IND with NO clinical trial follow-up and continuous inflated financings – still listed?
Investors want to KNOW …Transparency is very important because investors NEED to understand what's going on?
Mesoblast (MESO) closed up +$0.67 to $18.33 after Tuesday’s $17.66, Monday’s $18.70, Friday’s $18.51, Thursday’s $17.71, Wednesday’s $17.78 and last Tuesday’s $18.92 with a negative -$0.36 or -1.96% aftermarket indication with a 52-week change of +286.43% - time to lighten the “load”;
Adverum Biotechnologies (ADVM) closed down -$0.60 to $12.31 and has a positive +$0.09 or +0.73% aftermarket indication;
Applied Genetic Technologies (AGTC) closed down -$0.14 to $5.20 after Tuesday’s $5.34, Monday’s $ 5.15, last Friday’s $5.53 and the previous Thursday’s $5.51 and has NO aftermarket indication yet, I believe is oversold;
bluebird bio (BLUE) closed down -$2.80 to $56.41 after Tuesday’s $59.21, Monday’s $59.16, last Friday’s $58.92 and the previous Thursday’s $59.13 and has a positive +$0.49 or +0.87% aftermarket indication;
Global Blood therapeutics (GBT) closed down -$1.93 to $62.35 after Tuesday’s $64.28, Monday’s $62.61, last Friday’s $65.76 and the previous Thursday’s $65.60 and has a positive +$0.25 or +0.40%;
Pluristem (PSTI) closed up +$0.05 and has a pre-market +$0.66 or +6.43% pre-market indication on news of the U.S. FDA has cleared an Expanded Access Program (EAP) for the use of its PLX-PAD cells to treat Acute Respiratory Distress Syndrome (ARDS) caused by COVID-19 outside of the ongoing P2 COVID-19 study in the U.S. The program provides a pathway for patients that are not eligible for inclusion in the P2 clinical trial to be treated with PLX-PAD cells. The EAP will include up to 100 patients, with the resulting data collected and evaluated alongside Pluristem’s clinical trial.
The BOTTOM LINE: I’m back to saying - OVERSOLD; again, hoping for an uplift. However, sector investors need to understand the risks that are headed toward us …
Peter Lynch, the legendary investor and former Fidelity manager, said: “Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in corrections themselves.” <MarketWatch>
De-risk your portfolio … who are you holding, why did you buy into it, what is it trading at and where does it rank with its comparables - NOW.
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.