February 3, 2023 4:57pm
Strong jobs report worries some investors the Fed will keep hiking rates
Pre-open Indications: 8 Hits and 1 Miss
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The week in review - TGIF
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 portfolio are largely tied to your knowledge of price movements and questioning pricing targets.
The Dow closed DOWN-127.93 points (-0.38%), the S&P closed DOWN -43.28 points (-1.04%) while the Nasdaq closed DOWN -193.86 points (-1.59%)
Henry’omics:
We need to more than consider the economic environment - rising rates and inflation to comprehend the micro re “our” universe of cell and gene therapy companies
U.S. stocks tumbled Friday after government employment data showed more than half a million jobs were added in January — throwing a wrench in hopes for a pause on rate increases — while subpar earnings results from Tech giants weighed on investor sentiment.
A strong jobs report worried some investors the Federal Reserve would keep hiking rates.
For the week, the S&P 500 is up more than +2%, the Nasdaq +45 while the Dow was up +0.4%.
Economic Data Docket: The U.S. economy added 517,000 jobs in January, blowing past Dow Jones estimates of a jobs gain of 187,000 last month.
- Good synapsis, “For the Fed, it means they’ve got to be worried about a reacceleration in inflation. Even though wages are decelerating in this measure, aggregate demand is too strong. These are paychecks. Some of them multiple,” said Diane Swonk, KPMG chief economist. “We still have a lot more data before we get to March. For now, it’s a quarter point [hike]. They are not going to move off 5.25%. I can tell you that right now.”
Pre-open Indications: 8 Hits < Solid Biosciences (SLDB +$0.13); Sell into Strength: Alnylam Pharmaceuticals (ALNY +$3.62), Prime Medicine (PRME +$1.11), Ultragenyx (RARE -$1.61), Vericel (VCEL -$0.28), Verve Therapeutics (VERV -$0.72), Beam Therapeutics (BEAM-$0.34), CRISPR Therapeutics (CRSP -$0.85)> and 1 Miss < Intellia Therapeutics (NTLA -$1.37)>
Friday’s … RegMed Investor’s (RMi) Pre-Open: “anticipate risk of pullback as jobs report. Reiterating, “What goes up with ceremony, goes down with disdain followed by the opposite effect”. The market rally has come on strong in 2023. It's possible that the Nasdaq is due for some sort of pause.” … https://www.regmedinvestors.com/articles/12817
RegMed/Stem/Cell and Gene Therapy’s 35 covered equities’ Advance/Decline (A/D) lines: what happened –
- Friday’s advance/decline line opened negative at 9 up/ 23 down and 3 flats, flipped positive with 18 up/ 15 down and 2 flats at the mid-day, ending with a negative close of 15/19 and 1 flat
- Thursday’s advance/decline line opened negative at 9 up/ 29 down and 3 flats, flipped positive with 29 up/ 6 down and 1 flat at the mid-day, ending with a positive close of 29/5 and 1 flat
- Wednesday’s advance/decline line opened negative at 13 up/ 21 down and 1 flat, flipped positive with 24 up/ 10 down and 1 flat at the mid-day, ending with a positive close of 24/10 and 1 flat
- Tuesday’s advance/decline line opened positive at 30 up/ 5 down and 0 flats, stayed positive with 31 up/ 2 down and 2 flats at the mid-day, ending with a positive close of 30/5 and 0 flat
- Monday’s advance/decline line opened negative at 1 up/ 29 down and 5 flats, stayed negative with 5 up/ 29 down and 1 flat at the mid-day, ending with a negative close of 4/31 and 0 flat
Key Metrics:
The iShares NASDAQ Biotechnology (IBB) and the SPDR S&P ETF (XBI) indicators:
- Friday, the IBB was down -0.42% and the XBI was down -1.72%
- Thursday, the IBB was up +0.34% and the XBI was up +2.44%
- Wednesday, the IBB was up +0.12% and the XBI was up +0.94%
- Tuesday, the IBB was up +1.30% and the XBI was up +2.07%
- Monday, the IBB was down -1.77% and the XBI was down -2.56%
The CBOE Volatility Index (VVIX: INDEX) tracked:
- Friday was down -0.32 points or -1.71% at 18.41
- Thursday was up +0.56 points or +3.13% at 18.43
- Wednesday was down -1.52 points or -7.84% at 17.88
- Tuesday was down -0.54 points or -271% at 19.40.
- Monday was up +1.43 points or +7.73% at 19.94
Closing Down (10 of 19):
- Ultragenyx (RARE -$1.61 after Thursday’s +$2.10, Wednesday’s -$0.09, Tuesday’s +$2.34 and Monday’s -$0.74),
- Intellia Therapeutics (NTLA -$1.37 after Thursday’s +$1.45, Wednesday’s +$0.71, Tuesday’s +$2.32 and Monday’s -$1.51),
- Chinook Therapeutics (KDNY -$1.27),
- CRISPR Therapeutics (CRSP -$0.85 after Thursday’s +$3.79, Wednesday’s +$1.31, Tuesday’s +$1.06 and Monday’s -$2.82),
- Voyager Therapeutics (VYGR -$0.78 after Thursday’s -$0.48 and Wednesday’s -$0.08),
- Cellectis SA (CLLS -$0.75),
- Verve Therapeutics (VERV -$0.72 after Thursday’s +$1.94, Wednesday’s -$0.68, Tuesday’s +$0.98 after Monday’s -$0.65),
- Sage Therapeutics (SAGE -$0.43 after Thursday’s -$0.07, Wednesday’s +$0.32 and Tuesday’s +$1.19),
- Beam Therapeutics (BEAM -$0.34 after Thursday’s +$2.82, Wednesday’s +$2.32, Tuesday’s +$1.35 and Monday’s -$3.20),
- Regenxbio (RGNX -$0.31),
Flat:
- Biostage (OTCQB: BSTG $0.00 after Thursday’s $0.00, Wednesday’s +$0.28, Tuesday’s -$0.73 and Monday’s -$0.03),
Closing Up (10 of 15):
- BioLife Solutions (BLFS +$0.80 after Thursday’s +$1.75),
- Prime Medicine (PRME +$1.11 after Thursday’s +$2.35),
- Alnylam Pharmaceuticals (ALNY +$3.62 after Thursday’s +$4.84, Wednesday’s -$1.49, Tuesday’s +$1.00 and Monday’s -$5.97),
- Brainstorm Cell Therapeutics (BCLI +$0.60),
- AxoGen (AXGN +$0.18),
- Solid Biosciences (SLDB +$0.13 after Thursday’s -$0.03 and Wednesday’s -$0.04),
- Bellicum Pharmaceuticals (BLCM +$0.10 after Thursday’s -$0.06),
- Fate Therapeutics (FATE +$0.04),
- Homology Medicine (FIXX +$0.03),
- Mesoblast (MESO +$0.02),
- Bluebird bio (BLUE +$0.020,
- Precigen (PGEN +$0.01),
- Verastem (VSTM+$0.01),
- Adverum Biotechnologies (ADVM+$0.001),
Q1/23 – February
- Friday closed negative with 15 incliner, 19 decliners and 1 flat
- Thursday closed positive with 29 incliner, 5 decliners and 1 flat
- Wednesday (2/1) closed positive with 24 incliner, 10 decliners and 1 flat
The BOTTOM LINE: I try to keep it simple … and short!
Invest like you're driving on an icy, windy road, not an open highway. Proceed carefully, or wait it out on the side of the road.
A rally is always welcome but, is it investors or algorithms and electronic trading as the day after rally succumbs to a serious decline as it did TODAY!
As I had questioned, “the real question will be, WILL the UPSIDE last Friday? I say … NO!”
Heightened regulatory and commercial risk could/should be hampering gene-editing/ genetic medicine companies focused on rare diseases.
The FDA seems to be applying more regulatory scrutiny to a clinical candidate indicated for broad population segments, potentially extending development timelines with extended patient safety follow-up.
The FDA has not cleared an IND filing for any in vivo gene-editing trial in the U.S. to date.
Upcoming Q4 earnings reporting will present challenges to share pricing.
· Sage Therapeutics (SAGE) 2/16 - Thursday
· Alnylam Pharmaceuticals (ALNY) 2/23 - Thursday
If you thought of buying on weakness, you might be jumping onto a sinking ship.
Attention remains… laser-focused on week’s busy economic calendar; there’s still a bit of hesitation in front of inflation data to really see the reality of the markets and cell and gene therapy sector ability or capacity to move upward.
There are VERY clear losers today … Ultragenyx (RARE), Intellia therapeutics (NTLA) and Chinook Therapeutics (KDNY)
With winners … Alnylam Pharmaceuticals (ALNY), prime medicine (PRME) and BioLife Solutions (BLFS)
Avrobio (AVRO) closed down -$0.01 after Thursday’s +$0.01 to $0.94 with 638,562 shares traded, Wednesday’s +$0.02, Tuesday’s +$0.01, Monday’s +$0.01 with 206,848 shares traded and last Friday’s +$0.02 to $0.88 with 144,019 shares <3-month average = 354,039 shares>
The many sessions since acknowledging the de-listing “issue” say a lot of addressing the NASDAQ issue <is their investment bank buying the shares?> as AVRO 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 de-listing continues?
STILL, 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?
Biostage (OTCQB: BSTG)
Tuesday closed flat on Friday with 90 shares traded after Thursday’s flat with 0 shares traded, Wednesday’s +$0.28 with 467 shares traded, Tuesday’s -$0.73 with 3,710 shares traded after Monday closed down -$0.03 with772 shares traded and last Friday’s flat with 1,695 shares traded. <3-month average volume = 1,285 shares>
· BSTG has “pulled” its proposed offering … “Withdrawal of Registration Statement on Form S-1 (File No. 333-265741)”
· This IND – now almost 4 years old without a clinical trial that will last 3-5 years for ADULT patients before BSTG can EVEN consider a pediatric venue!
Question; is OTCQB: BSTG a Ponzi scheme (the pump/promote buy and sell agenda) as shares are bought to replace those sold??
My question that resounds, 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.
