January 12, 2021 8:10am
Momentum and sentiment indicators are stretched yet, yesterday’s breather brought back a FOMO (fear of missing out)
Pre-open indication: 3 SELLs and 3 BUYs
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Dow futures are UP +0.26% (+80 points), S&P futures are UP +0.30% (11 points) and NASDAQ futures are UP +0.38% (+49 points)
U.S. equity futures were slightly higher early Tuesday;
European markets mixed as investors focus on coronavirus, U.S. politics;
Asia-Pacific markets were mixed with mainland Chinese stocks leading gains among the region’s major markets while Malaysia’s king declared a state of emergency in the country that the country would tighten Covid-19 restrictions from Wednesday.
The RegMed/Stem/Cell and gene therapy sector advance/decline (A/D) line slipped yet again (Friday -16/18 and 1 acquired and Monday’s - 13/20, 1 flat and 1 acquired).
An increase in the number of coronavirus cases being seen worldwide is weighing on sentiment.
The SPDR S&P Biotech ETF (NYSEMKT: XBI) – is usually a good barometer for RegMed/Stem/Cell and gene therapy sector -- delivered a 48% gain last year. That marked the best performance for the ETF since 2013, when it soared by roughly the same amount. In six of the last 10 years, the biotech ETF generated a return of at least 30%. <Motley Fool>
Data Docket: November JOLTS job openings data is at 10:00 a.m. The DOE January crude oil output forecast and the WASDE report are both at 12:00 p.m. Fed Governor Lael Brainard, Kansas City Fed President Esther George and Boston Fed President Eric Rosengren speak later. Rosengren and George are joined by Minneapolis Fed President Neel Kashkari at a separate event on racism and the economy. CES continues and Jeffrey Gundlach holds his annual webcast.
Monday’s evening’s recap: RegMed Investors’ (RMi) closing bell: “Washington tension drains sentiment. Political upheaval and a pandemic have raised concerns that markets are less than rational” … https://www.regmedinvestors.com/articles/11716
- The Nasdaq closed DOWN -165.54 points (-1.25%);
- The IBB closed down -0.16% and XBI closed down -0.99%
- Sector volume was BALANCED with 5 of the 13-upside having higher than the 3-month average volume with the increased volume of 10 of 20-downside having higher than the 3-month average volume;
- The CBOE Volatility Index (VVIX: INDEX) was up +2.52 points or +11.69% at 24.08;
- Monday’s percentage (%) of the 13-upside were +0.17% (SAGE) to +31.64% (MESO) while the 20-downside ranges from -0.62% (CLBS) to -15.06% (EDIT);
- 4 positive and 2 negative closes, so far
Companies in my headlights – It’s your decision; I provide an idea and context:
Biostage (BSTG) closed down -$0.06 to $1.10 with 3,202 shares traded after Friday’s -$0.04 to $1.16 with 700 shares traded, Thursday’s -$0.01 to $1.20 with 2,600 shares trade, Wednesday’s -$0.06 to $1.21 with 400 shares traded and last Tuesday’s -$0.10 to $1.15 with 11,900 shares traded. Reiterating the questions …
- Question#1: Could RSM US LLP suffer of “serious and serial failures” in their audit of BSTG?
- Questio#2: Is there, pressure on the partner to meet internal client retention expectations versus their DUTY to CHECK the RELIABILITY of the liabilities and accounts payables to achieve a rectification of PAST and NOT CARRIED FORWARD accrued and current liabilities?
- Question#3: Shunfu Hu, VP of business development and operations” might” you have conveniently “lost, misplaced or discarded” past and pertinent billings that should have come to the attention of the auditors?
Maintaining SELL into Strength:
Intellia Therapeutics (NTLA) closed down -$5.58 to $72.78 after Friday’s +$0.88 to $78.36, Thursday’s +$10.74, Wednesday’s +$5.73 and last Tuesday’s +$5.10 and has a negative -$0.18 or -0.25% aftermarket indication;
CRISPR therapeutics (CRSP) closed down -$4.94 to $188.88 after Friday’s $193.82, Thursday’s $194.43, Wednesday’s $163.85 and last Tuesday’s $160.62 with a negative -$1.28 or -0.68% aftermarket indication and a 52-week change of +228.56%;
Editas Medicine (EDIT) closed down -$13.64 to $76.94 after Friday’s $90.58, Thursday’s $89.66, Wednesday’s $80.54 and last Tuesday’s $76.84 and has a positive +$1.05 or +1.36% aftermarket indication;
ReNeuron (RENE.) closed flat at $107.00 and is up +$7.50 (+7.43%) to $114.50 in the pre-market
SELL from BUY:
Mesoblast (MESO) closed up +42.74 to $11.40 after Friday’s -$0.26 to $8.66 and has a negative -$0.78 or -6.84% aftermarket indication on news, a bounce-down after a solid run and profit taking;
The BOTTOM LINE: Amid the chaos, global stocks stabilized this morning after yesterday's losses, with dip-buying interests. Overnight the MSCI Asia Pacific Index added 0.3% while Japan's Topix index closed 0.2% higher. In Europe, the Stoxx 600 Index had gained 0.1% by 5:50 a.m. with cyclical sectors recovering from yesterday's slump. S&P 500 futures pointed to some green at the open,
As Democrats push ahead with impeachment; investors are leery, looking to brighter days as the economy rebounds and vaccines conquer COVID-19; as they are NOW competing with the political grandstanding and Washington risks.
The market has gotten too optimistic, a bit of pessimism was blended-in as the week settled and after the recent breather, we should see some bounce back in our universe of equities.
Earnings season Is about to begin. Investors are considering whether they should ignore and wait for Q2.
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.