February 6, 2023 7:42am
Don't be surprised to see a market pullback and the resulting sector dynamic
Pre-Open Indications: 2 Positive Indications, 3 Negative Indications and 1 Sell into Strength
News: Sage Therapeutics (SAGE +$2.39 pre-market indication) and Biogen (BIIB) announced the U.S. FDA has accepted the filing of a New Drug Application (NDA) for zuranolone in the treatment of major depressive disorder (MDD) and postpartum depression (PPD). Zuranolone is an investigational drug being evaluated as a 14-day, rapid-acting, once-daily, oral treatment in adults with MDD and PPD. The application has been granted priority review and the FDA has assigned a Prescription Drug User Fee Act (PDUFA) action date of August 5, 2023.
It’s an honor to be considered the “canary in the (sector) coal mine”! It’s more than opinion, the facts and truth need to be recognized!
I write this blog/newsletter to inform investors with facts and supporting numbers focused on what they need to hear that others won’t say or write about - truth! Subscription is coming, it’s not conscription but, an offer to join our collective of like-minded investors! Join me … in the NO spin zone.
The 8:00 a.m. edition
Remember that overnight and pre-open actions in futures don't necessarily translate into actual trading in the coming day’s session. My interpretation of the morning’s numbers is written to be informative; it’s built on will happen behind the headlines today, not tomorrow or yesterday …
Dow futures are DOWN -0.56% or (-189 points), S&P futures are DOWN -0.74% or (-30 point) and NASDAQ futures are DOWN -0.95% or (-120 points) early in the pre-open – so far
Stock futures slide to start week with a Powell speech ahead,
European markets were lower,
Asia markets close mostly lower
Henry’omics:
We need to understand the macro to comprehend the micro re “our” universe of cell and gene therapy companies …
Indexes fell Friday as a strong jobs report worried some investors that the Fed would keep hiking rates.
The S&P 500 declined 1.04% to 4,136.48, the Nasdaq shed 1.59% to 12,006.95 as the Dow slipped 127.93 points, or 0.38%, to 33,926.01.
Economic Data Docket: Markets will likely be on edge ahead of a speech by Federal Reserve Chairman Jerome Powell Tuesday before the Economic Club of Washington. Powell’s comments on disinflation caused investors to bid shares higher last week and overlook another rate hike out of the central bank.
Friday’s (2/3) … RegMed Investors’ (RMi) closing bell: “good news seems to be bad news and bad news is good news. In normal times, no one really questions whether good news in the economy is actually good. Strong jobs report worries some investors the Fed will keep hiking rates.” … https://www.regmedinvestors.com/articles/12818
Ebb and flow:
Q1/23 – February – 1 negative and 2 positive closes
· January – 2 holidays, 11 positive and 9 negative closes
Q4/2022
· December – 1 holiday, 13 negative and 8 positive closes
· November -1 holiday, 14 negative and 8 positive closes
· October -1 neutral, 11 positive and 9 negative closes
Companies in my headlights – It’s your decision; I provide ideas and context: INDICATIONS
Positive Indications:
Sage Therapeutics (SAGE) closed down -$0.43 to $44.16 with a positive +$2.39 pre-market indication after the U.S. FDA has accepted the filing of a New Drug Application (NDA) for zuranolone in the treatment of major depressive disorder (MDD) and postpartum depression (PPD). The FDA has assigned a Prescription Drug User Fee Act (PDUFA) action date of August 5, 2023.
Beam Therapeutics (BEAM) closed down -$0.34 to $48.45 after Thursday’s +$2.82, Wednesday’s +$2.52, Tuesday’s +$2.32 and last Monday’s -$1.51 with a positive +$2.55 or +5.26% pre-open indication
Sell into Strength:
Alnylam Pharmaceuticals (ALNY) closed up +$3.62 to $233.37 after Thursday’s +$4.84 after Wednesday’s -$1.49, Tuesday’s +$1.00 and Monday’s -$5.97 with a negative -$4.67 or -2% aftermarket indication
Negative Indications:
Verve Therapeutics (VERV) closed down -$0.72 to $23.29 after Thursday’s +$1.94 after Wednesday’s -$0.68 with a negative -$0.79 or -3.39% aftermarket indication
Intellia Therapeutics (NTLA) closed down -$1.37 to $43.23 after Thursday’s +$1.45, Wednesday’s +$0.71 Tuesday’s +$2.32 and last Monday’s -$1.51 with a negative -$0.46 or -1.06% pre-open indication
CRISPR Therapeutics (CRSP) closed down -$0.85 to $55.27 after Thursday’s +$3.79 with a negative -$0.39 or -0.71% pre-open indication.
The BOTTOM LINE: I try to keep it simple and short!
Don't be surprised to see a market pullback after the big gains in recent weeks,
Perhaps the biggest complaint about the current market rally is that it's too strong. The Nasdaq has run up for five straight weeks. The CBOE Volatility Index, or VIX, as well as the put/call ratio, have tumbled, signaling growing complacency. <IBD>
Perhaps Friday's retreat was the start of a much-needed pause or pullback for the major indexes.
A lot of interesting stocks are looking significantly extended.
The market and sector “gyrate” as algorithms and electronic trading satisfies the lust for returns in quant and hedge funds. I STILL don’t think it’s a good time to add exposure.
I do NOT believe there aren't a lot of cell/gene therapy companies in position yet – UNTIL earnings (Q4) are reported – any breakout is a false hope with the inevitable downside re-occurring.
I also hate to be so negative or contrarian but, this is a NO spin zone and truth is its product.
And I can always be WRONG but, mostly EARLY!
Upcoming Q4 earnings reporting will present challenges to share pricing.
· Sage Therapeutics (SAGE) 2/16 - Thursday
· Alnylam Pharmaceuticals (ALNY) 2/23 - Thursday
So be cautious about adding exposure and stick to loss-cutting rules.
A couple of companies have become … black holes … of investor sentiment; yet, some get financing to continue the chain around investors’ necks until they recognize it could be forever with “some” of these equities.
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.
All investments are subject to risks. Investors should consider investment objectives.
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.
Henry McCusker, the editor and publisher of RegMed Investors does not hold or have positions securities referred to in this publication.
