November 10, 2023 4:55pm
Sisyphus’itis to have to continue rolling a share pricing stone uphill, only to have it always roll down again
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The week in review, have you thanked a veteran today?
I also won’t apologize for being a “Devil’s Advocate” challenging views or consensus by building a better or possible case for an explanation of today’s actions
The Dow closed UP +391.16 points or +1.15%, the S&P closed UP +67.89 points or +1.56% while the Nasdaq closed UP +276.66 points or +2.05%
Q3 earnings’ reporting cycle is here to confirm whether or not any bottoms are even close to happening?
A plug, my first and probably only: Scott Mann (LtCol retired) Green Beret, Keynote Speaker, Leadership Coach has a book – “Operation Pineapple Express” that must be read and with a kindle version - Get it! Also, he is behind the play – “LAST OUT: Elegy of a Green Beret.” SUPPORT the MISSION and the CAUSE for a pal who “STOOD UP” when many scurried from the fray! <scottmann.com to learn more about his projects>
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 …
Indexes rallied Friday, recovering the ground lost in the previous session as Treasury yields stabilized. This latest move higher put the major averages on track to end the week higher.
Economic Data Docket: The preliminary reading on consumer sentiment in November from the University of Michigan showed the index came in at 60.4 this month, well below the 63.7 expected by economists and the lowest for the measure since May. Friday's reading also marked the fourth straight month of declines.
RegMed/Stem/Cell and Gene Therapy’s 35 covered equities’ Advance/Decline (A/D) lines: what happened – differences …
- Friday’s advance/decline line pre-open was positive with 20 incliners, 13 decliners and 2 flats; flipped negative at the mid-day with 8 incliners and 24 decliners and 3 flats at the mid-day, ending with a negative close of 13 incliners, 20 decliners and 2 flats
- Thursday’s advance/decline line pre-open was negative with 8 incliners, 25 decliners and 2 flats; was negative at the mid-day with 2 incliners and 33 decliners and 1 flat at the mid-day, ending with a negative close of 3 incliners, 30 decliners and 2 flats
- Wednesday’s advance/decline line pre-open was negative with 12 incliners, 23 decliners and 1 flat; was negative at the mid-day with 3 incliners and 30 decliners and 2 flats at the mid-day, ending with a negative close of 8 incliners, 26 decliners and 1 flat
- Tuesday’s advance/decline line pre-open was positive with 21 incliners, 11 decliners and 3 flats; was positive at the mid-day with 23 incliners and 10 decliners and 2 flats at the mid-day, ending with a positive close of 23 incliners, 7 decliners and 5 flats
- Monday’s advance/decline line was negative with 27 incliners, 8 decliners and 2 flats at the mid-day, ending with a negative close of 8 incliners, 25 decliners and 2 flats
Ebb and flow:
Q4: November – 4 positive and 4 negative closes
· October – 12 negative and 10 positive closes
The iShares NASDAQ Biotechnology (IBB) and the SPDR S&P ETF (XBI) indicators:
- Friday, the IBB was up +0.48% and the XBI was up +0.54%
- Thursday, the IBB was down -2.95% and the XBI was down -4.09%
- Wednesday, the IBB was down -1.51% and the XBI was -2.92%
- Tuesday, the IBB was up +0.75% and the XBI was up +2.32%
- Monday, the IBB was down -0.32% and the XBI was down -2.21%
The CBOE Volatility Index (VVIX: INDEX) tracked:
- Friday was down -1.12 point or -7.33% at 14.17
- Thursday was up +0.80 point or +5.61% at 15.26
- Wednesday was down -0.36 point or -2.43% at 14.45
- Tuesday was down -0.02 point or -0.13% at 14.87
- Monday was down -0.02 point or -0.13% at 14.89
Closing Down (10 of 20):
- Alnylam Pharmaceuticals (ALNY -$2.63 after Thursday’s -$4.88, Wednesday’s -$0.80 and Tuesday’s +$3.05),
- Ionis Pharmaceuticals (IONS -$0.95 after Thursday’s +$0.22),
- Intellia Therapeutics (NTLA -$0.83 after Thursday’s -$3.49, Wednesday’s -$1.04, Tuesday’s +$1.83 and Monday’s -$1.10),
- BioLife Solutions (BLFS -$0.44),
- Verve Therapeutics (VERV -$0.34),
- Editas Medicine (EDIT -$0.20),
- uniQure NV (QURE -$0.19).
- Precigen (PGEN -$0.17 after Thursday’s +$0.005),
- Sage Therapeutics (SAGE -$0.14 after Thursday’s -$1.26, Wednesday’s -$1.13, Tuesday’s -$0.98 and Monday’s -$0.68),
- Agenus (AGEN -$0.103),
- Harvard Apparatus GN (HRGN)
- Homology Medicine (FIXX)
Closing Up (10 of 13):
- CRISPR Therapeutics (CRSP +$1.90 after Thursday’s -$3.46, Wednesday’s -$5.69, Tuesday’s +$7.00 and Monday’s +$0.59),
- Blueprint Medicine (BPMC +$1.60 after Thursday’s -$2.01 after Wednesday’s -$1.36, Tuesday’s +$1.89 and Monday’s -$1.04),
- Vericel (VCEL +$1.48 after Thursday’s -$2.84 after Wednesday’s -$1.24),
- Regenxbio (RGNX +$1.03 after Thursday’s +$0.40),
- MiMedx (MDXG +$0.24),
- Generation Bio (GBIO +$0.11),
- Cellectis SA (CLLS +$0.11),
- Solid Biosciences (SLDB +$0.08 after Thursday’s -$0.66),
- Mesoblast (MESO +$0.03),
- Adverum Biotechnologies (ADVM +$0.0265),
Q4/23 – November
- Friday closed negative with 13 incliners, 20 decliners and 2 flats
- Thursday closed negative with 3 incliners, 30 decliners and 2 flats
- Wednesday closed negative with 8 incliners, 26 decliners and 1 flat
- Tuesday closed positive with 23 incliners, 7 decliners and 5 flats
- Monday closed negative with 8 incliners, 25 decliners and 2 flats
The BOTTOM LINE: NO downside surprises here …
- The cell and gene therapy sector is shell shocked by sentiments … leaving.
- While indexes are bouncing back from Thursday's rough session. Somewhat hawkish comments from Fed Chair Powell and weaker-than-expected demand for a 30-year Treasury bond auction sent stocks tumbling.
- While sector stocks fluctuated for the week, they’ll face bigger challenges in the week ahead… unless – algorithms and electronic trading claim “the field”!
“Too many people were far too over their skis on the short side, both of equities and bonds, and you've seen that reverse in a huge way in the course of the last week." < Michael James, managing director of equity trading at Wedbush Securities in Los Angeles>
- U.S. Treasury yields rose sharply on Thursday after a very weak 30-year bond auction. The extra yield needed to get the issue sold was the largest in several years as was the amount dealers were forced to absorb,
- Short positioning and leveraged trading in hedge funds percentage (%) is the highest since November 2018 …
- Regulators are particularly concerned about one strategy called the basis trade, which involves using leverage to profit from the price gap between Treasury futures and the underlying cash market. It has garnered particular attention from federal watchdogs over concerns about a lack of visibility into the amount of risk in the market.
- Reiterating, more earnings are coming around the bend as LPS (loss-per-share) cascaded.
- Up and down market and past cell and gene therapy activity is reflective of investors sentiment – we be happy as November starts but, does it continue this and next week?
- Middle East conflict still weighed on the market as investors assessed the chances of it breaking out into a wider war. The rising geopolitical tensions in the Middle East could drive a global recession, leading investors have warned.
I STILL believe the political aspect of the U.S.’s polarization, and disparities of the debt ceilings and rate hike arguments are contributing to the roller coaster ride for share pricing actions.
What’s behind the numbers: this week is kind of a dead zone for economic news, but next week investors are going to have CPI (consumer prices), PPI (producer prices) and retail sales.
- Market expectations have become more questionable …
- The sector and overall stock market tends to consistently rise and fall over the short-term with alternating volatility and involuntary momentum contraction.
- I remain EXTREMELY cautious as upcoming earnings may have a more significant negative impact on share price due to missed consensus as estimates will lessen valuations.
Welcome to my world of defining the “grey’ in our universe!
- I believe … there will be deceleration in sector pricing gains and economic activity for the remaining weeks of 2023.
The top three (3) performing in the session:
- Friday: CRISPR Therapeutics CRSP), Blueprint Medicine (BPMC) and Vericel (VCEL)
- Thursday: Regenxbio (RGNX), Ionis Pharmaceuticals (IONS) and Bellicum Pharmaceuticals (BLCM)
- Wednesday: Cellectis SA (CLLS), Homology Medicine (FIXX) and Fate Therapeutics (FATE)
- Tuesday: CRISPR Therapeutics (CRSP) – 5x, Verve Therapeutics (VERV) and Alnylam Pharmaceuticals (ALNY)
- Monday: CRISPR Therapeutics CRSP) – 4x, Verve Therapeutics (VERV) and Alnylam Pharmaceuticals (ALNY)
The worst three (3) in the session:
- Friday: Alnylam Pharmaceuticals (ALNY) -2x, Ionis Pharmaceuticals (IONS) and Intellia Therapeutics (NTLA) -2x
- Thursday: Alnylam Pharmaceuticals (ALNY), CRISPR Therapeutics (CRSP) and Intellia Therapeutics (NTLA)
- Wednesday: CRISPR Therapeutics (CRSP), Beam Therapeutics (BEAM) and Verve Therapeutics (VERV)
- Tuesday: Sage Therapeutics (SAGE), Cellectis SA (CLLS) and MiMedx (MDXG)
- Monday: Beam Therapeutics (BEAM), Intellia Therapeutics (NTLA) and Blueprint Medicine (BPMC)
Right up front, “I also hate to be so negative or contrarian but, this is a NO spin zone and truth is its product; I can always be WRONG but … I am mostly EARLY!”
- Focus continues to be on the quarterly earnings season!
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.
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