December 14, 2022 4:49pm

The Fed delivered a widely-anticipated 50-basis point rate hike which likens to deepen economic pain in share pricings

Pre-open Indications: 7 Hit and 0 Miss

My news: Avrobio (AVRO) keeps diving (-$0.0049 with 158,282 shares traded) as de-listing continues, hoping for a $250 million Cowen offering to “solve” its issues? Shareholders lose and CEO Mackay needs to go! Remember Applied Genetic Technologies (AGTC), bought for pennies by a shell or was it just another “Alamo” death?

The Biostage (OTCQB: BSTG) Chronicles: Notice the downside of -$0.25 with only 5 shares traded, the pump/promote (illegal) has kept the share price “floating” otherwise it’s a “bust”??

Why do I keep writing this blog/newsletter; to inform investors, what others won’t say or write

If I have learned one thing as a former research analyst in a venture and public fund now a journalist; it is that your life and your bank account are largely tied to your knowledge of price movements and questioning pricing targets.

 

The Dow closed DOWN -142.29 points (-0.42%), the S&P closed DOWN -24.33 points (-0.61%) while the Nasdaq closed DOWN -85.93 points (-0.76%)

 

Henry’omics:

We need to understand the macro to comprehend the micro re “our” universe of cell and gene therapy companies

Indexes gained ahead of Fed rates hikes and Fed Chair Powell's comments, dived, came back and then dropped like a stone dropped into water.

  • While Treasury yields were flat and the dollar edged up, after the U.S. Fed announced that it would raise interest rates by half a percentage point, the move expected by financial markets.

Quote need to be considered, “The big issue that makes it hawkish is that the Fed’s forecasts put the terminal rate at 5.1% for 2023 from 4.6% at the September meeting,” said Jim Caron of Morgan Stanley Investment Management. “There’s no tip of the hat to the notion that [the pace of] inflation is starting to decline. They just completely ignored it.” <CNBC>

Another opinion, “There is a much more worrisome scenario, however, in which US inflation remains stubbornly high, perhaps because the combination of continued tight labor markets and elevated living costs fuel persistent rapid wage growth. Such a wage-price spiral would pose a difficult conflict between the policy needs of the US economy and those of the rest of the world. Further increases in interest rates would be essential to bring down US inflation and inflation expectations. But at a time when many of our trading partners were mired in recession, further policy tightening could create grave problems abroad: substantial job losses, widespread defaults and disruptions in international financial markets.” <CNN>

Volume fell on the Nasdaq versus the same time on Tuesday.

Economic Data Docket: The Fed delivered a widely-anticipated 50 basis point rate hike at the conclusion of its December policy meeting. It’s a smaller bump from the prior four consecutive rate hikes of 75 basis.

  • Chairman Powell signaled more data was needed before the central bank would meaningfully change its view of inflation.

 

Wednesday’s … RegMed Investor’s (RMi) Pre-Open: “waiting for Jerome’s latest interest rate hike decision. His comments about inflation, recession risks and peak Fed rates will forecast equity’s direction and Treasury yields.” …  https://www.regmedinvestors.com/articles/12743

 

RegMed/Stem/Cell and Gene Therapy’s 35 covered equities’ Advance/Decline (A/D) lines: what happened – quite a difference …

  • Wednesday’s advance/decline line opened positive at 20 up/ 13 down and 2 flats, flipped negative with 13 up/ 22 down and 0 flat at the mid-day, ending with a negative close of 12/23 and 0 flat.

 

Pre-open indication results: 7 Hit < Verve Therapeutics (VERV +$0.16), Prime Medicine (PRME -$0.05), Sage Therapeutics (SAGE -$0.46); Sell into Strength: Chinook Therapeutics (KDNY -$0.06), uniQure NV (QURE +$0.06), Vericel (VCEL +$1.38), Voyager Therapeutics (VYGR -$0.41)> and 0 MISS <

 

Key Metrics:

The iShares NASDAQ Biotechnology (IBB) and the SPDR S&P ETF (XBI) indicators:

  • Wednesday, the IBB was up +0.54% and the XBI was up +0.33%

The CBOE Volatility Index (VVIX: INDEX) tracked:

  • Wednesday was down -1.20 points or -5.32% at 21.35

 

Closing Down (10 of 23):

  • Alnylam Pharmaceuticals (ALNY -$3.07 after Tuesday’s +$1.12 and Monday’s +$4.53),
  • Intellia Therapeutics (NTLA -$ after Tuesday’s -$0.01 and Monday’s +$2.10),
  • Fate Therapeutics (FATE -$1.00),
  • Beam Therapeutics (BEAM -$0.86 after Tuesday’s +$1.44 and Monday’s +$5.18),
  • BioLife Solutions (BLFS -$0.52),
  • CRISPR Therapeutics (CRSP -$0.51 after Tuesday’s -$0.36 and Monday’s +$2.07),
  • Sage Therapeutics (SAGE -$0.46 after Tuesday’s +$0.73 and Monday’s +$1.93),
  • Voyager Therapeutics (VYGR -$0.41),
  • Biostage (OTCQB: BSTG -$0.25 with 5 shares traded),
  • Cellectis SA (CLLS -$0.14),

Closing Up (12 of 12):

  • Vericel (VCEL +$1.22 after Tuesday’s +$0.99),
  • Ultragenyx (RARE +$0.53 after Tuesday’s +$2.15 and Monday’s +$2.13),
  • Editas Medicine (EDIT +$0.40 after Tuesday’s +$0.48),
  • Regenxbio (RGNX +$0.22 after Tuesday’s +$0.82 and Monday’s +$0.97),
  • bluebird bio (BLUE +$0.19),
  • Ionis Pharmaceuticals (IONS +$0.17 after Tuesday’s -$0.13 and Monday’s +$0.76),
  • Solid Biosciences (SLDB +$0.16),
  • Verve Therapeutics (VERV +$0.16 after Tuesday’s -$0.32 and Monday’s +$1.12),
  • Brainstorm Cell Therapeutics (BCLI +$0.15 after Tuesday’s -$0.21),
  • uniQure NV (QURE +$0.06 after Tuesday’s +$0.47 and Monday’s +$0.69),
  • Precigen (PGEN +$0.06),
  • Compass Therapeutics (CMPX +$0.04),

 

Q4 – December

  • Wednesday closed negative with 12 incliner, 23 decliners and 0 flat
  • Tuesday closed positive with 26 incliner, 8 decliners and 1 flat
  • Monday closed positive with 30 incliner, 3 decliners and 2 flats

 

The BOTTOM LINE: I try to keep it simple … and short!

The cell and gene therapy sector ran out of momentum …

Reiterating, there are losers and fewer losers as compared to yesterday;

·         Wednesday closed negative with 12 incliner, 23 decliners and 0 flat

·         Tuesday closed positive with 26 incliner, 8 decliners and 1 flat

the following paragraphs … might be construed to be contrarian … AS I STATED be prepared for downdrafts!

It happened an 'eye(s) of the tiger' moment, which refers to what the tiger's (algorithms) prey last sees prior to being killed. It's a reference to impending downfall of sector equities or the prey.

Be prepared … just 13 trading days remain in 2022.

I believe the sector will become even more focused on CEOs and management teams lining their own pockets with OUTSIZED G&A “obligations” as share pricings hug bottoms.

To alleviate investor concern, communication MUST will be driven by a CONSTANT out-reach to individual investors; even to those who have been the worst detractors – I did it once upon a time and the “share price droning” slowed and many holders became educated and jumped on the band wagon - TRUE story after some dark days of valuation.

Just 13 trading days remain in 2022.

Yet again, many stocks have experienced downside progression - today as I believe, “uncle” algorithms hopped on the overbought to “make a buck or two” into a retreat from yesterday’s high.

Avrobio (AVRO closed down -$0.0049 on Wednesday after Tuesday’s +$0.01 after Monday’s flat $0.00 (says a lot of addressing the delisting issue) having filed a S-3 for $250 million common stock, preferred stock, debt securities, warrants and unit offering within draft prospectus by Cowen as stock sinks while delisting continues? Just another “screw-job” of investors! < Read, SELL and Weep - see hyperlink below> Avrobio (AVRO) files S-3 (Registration Statement) for offering with draft prospectus by Cowen … https://investors.avrobio.com/node/9116/html

·         Also, RA Capital has sold its position in the company – a sign of dissatisfaction!

·         While, President, CEO and director Geoff Mackay carries home a HUGE salary of $754.39 K per year?

As I continually question, “The real question that should be asked is how many companies are at the end of sentiments …  leash?

 

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.

Regulation Analyst Certification (Reg AC): The research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report accurately reflect my personal views about the subject company or companies and its or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.