February 1, 2025 11:56am
A deep dive after 1 positive close and the 4-session share pricing sector losses
There wouldn't be a market without equities moving in both directions.
Earnings Season: 3 releases identified to date <see in The Bottom Line>
I say today what others won't, so you can do what others can't!
Never leave an investor uninformed!
The week in Review
On point, short on words, long on facts and being judicious!
I follow the dictum, quoting Churchill that “short words are best, and the old words when short are best of all.”
VIP: I will be possibly unavailable in the week 2/3 – 2/7/25 due my “better half “undergoing surgery and hospitalized – say a prayer please!
Friday: The Dow closed DOWN -337.47 points or -0.75%, the S&P closed DOWN -30.64 points or -0.50% while the Nasdaq closed DOWN -54.31 points or -0.28%
- Indexes closed down after an inflation report
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
- December data for the personal consumption expenditures (PCE) price index showed an increase of 0.3% from November and a 2.6% annual rate; marking an acceleration from the prior month’s rate of 2.4% raising some concerns that inflation remains sticky. Excluding food and energy, core PCE also increased 0.2% monthly and 2.8% on an annual basis.
Friday’s advance/decline line at the open was positive with 22 incliners, 11 declined and 2 flats; ending with a negative close at the close of 9 incliner, 25 decliners and 1 flat
- Highlights January’s rocky road for the sector’s share pricingvolatile journey
Metrics: Friday, the IBB was down -0.21%, the XBI was down -0.81% while the VIX was up +0.59 points or +3.72% at 16.43
Thursday: The Dow closed UP +168.61 points or +0.38%, the S&P closed UP +31.86 points or +0.53% while the Nasdaq closed UP +49.43 points or +0.25%
- Indexes posted gains in a bout of turbulent trading Thursday
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
- The U.S. economy grew at a slower-than-expected pace during the final 3 months of 2024. Gross domestic product grew by 2.3% in Q4 on an annualized basis, while economists expected an increase of 2.5%. Full-year GDP expanded at a solid 2.8% pace after growing by 2.9% in 2023.
- The Pending Home Sales Index, which tracks contract signings on existing homes, dropped 5.5% from November to 74.2, snapping a 4-month streak of gains, according to the National Association of Realtors (NAR). An index level of 100 is equal to contract activity in 2001.
Thursday’s advance/decline line at the open was positive with 25 incliners, 7 declined and 3 flats; ending with a positive close at the close of 20 incliner, 13 decliners and 2 flats
- Thursday’s share pricing floated like a butterfly
Metrics: Thursday, the IBB was up +1.38%, the XBI was up +0.96% while the VIX was down -0.72 points or -4.35% at 15.84
Wednesday: The Dow closed DOWN -136.83 points or -0.31%, the S&P closed DOWN -28.39 points or -0.47% while the Nasdaq closed DOWN -101.26 points or -0.51%
- Indexes slid on Wednesday after the Fed left interest rates unchanged in its first policy decision of the year
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
- Fed, central bank’s decision to hold interest rates steady in a range of 4.25% to 4.5%
- The unemployment rate has stabilized at a low level in recent months, and labor market conditions remain solid,” new language in the statement said. “Inflation remains somewhat elevated.” <JPowell, Fed Chair>
Wednesday’s advance/decline line at the open was positive with 20 incliners, 11 declined and 4 flats; ending with a negative close at the close of 9 incliner, 24 decliners and 2 flats
Metrics: Wednesday, the IBB was down -0.67%, the XBI was down -0.60% while the VIX was up +0.16 points or +0.98% at 16.57
Tuesday: The Dow closed UP +136.77 points or +0.31%, the S&P closed UP +55.42 points or +0.92% while the Nasdaq closed UP +391.75 points or +2.03%
- Indexes gravitated Tuesday recovering from a sell-off sparked by the Chinese artificial intelligence startup DeepSeek
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
- Durable goods demand declined 2.2% for the period, the 4th drop over the past 5 months, including a 2% slide in November. Economists had been looking for an increase of 0.5%. Excluding transportation, orders showed a 0.3% increase. Nondefense aircraft and parts orders tumbled 45.7%.
Tuesday’s advance/decline line at the open was negative with 9 incliners, 24 declined and 3 flats; ending with a negative close at the close of 14 incliner, 17 decliners and 4 flats
Metrics: Tuesday, the IBB was up +0.57%, the XBI was down -0.21% while the VIX was down -11.49 points or -8.31% at 16.41
Monday: The Dow closed UP +289.33 points or +0.65%, the S&P closed DOWN -88.96 points or -1.46% while the Nasdaq closed DOWN -612.47 points or -3.07%
- Indexes closed mixed and down on concern about an artificial intelligence stock bubble
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
- New-home sales rose again in December to a seasonally adjusted annual rate of 698,000, a 3.6% increase from November 2024 and a 6.7% increase from December 2023.
Monday’s advance/decline line at the open was positive with 25 incliners, 8 declined and 2 flats; ending with a negative close at the close of 12 incliner, 21 decliners and 2 flats
- Sector breadth fluctuated to the downside further
Metrics: Monday, the IBB was up +1.04%, the XBI was up +0.14% while the VIX was up +3.09 points or +20.81% at 17.94
Q1/25 – 2 holidays, 1 market close, 10 negative and 10 positive closes
- Q4/24 – 1 holiday, 6 positive and 15 negative closes
- November – 1 holiday, 10 negative and 10 positive closes
- October: 8 positive and 15 negative sessions
Friday’s Closing Down (10 of 25)
- Alnylam Pharmaceuticals (ALNY -$5.85 after Thursday’s +$3.17 after Wednesday’s -$5.20, Tuesday’s +$2.77 and Monday’s -$2.03),
- Moderna (MRNA -$1.62 after Thursday’s +$0.32, Wednesday’s -$4.22 and Tuesday’s +$3.29),
- Blueprint Medicine (BPMC -$1.52 after Thursday’s -$0.27 after Wednesday’s +$0.15, Tuesday’s +$0.59 and Monday’s -$1.03),
- Ionis Pharmaceuticals (IONS -$1.42 after Thursday’s +$0.44 after Wednesday’s +$1.23),
- Beam Therapeutics (BEAM -$1.36 after Thursday’s +$1.37),
- Vericel (VCEL -$0.71),
- CRISPR Therapeutics (CRSP -$0.45 after Thursday’s +$0.83 after Wednesday’s +$0.60),
- BioLife Solutions (BLFS -$0.40 after Thursday’s -$0.60 after Wednesday’s -$0.19, Tuesday’s +$0.21 and Monday’s +$0.50),
- Ultragenyx Pharmaceuticals (RARE -$0.37 after Thursday’s +$0.93),
- MiMedx (MDXG -$0.21 after Thursday’s -$0.14),
Flat (2)
- Homology Medicine (FIXX)
- Sangamo Therapeutics (SGMO)
Friday’s Closing Up (9 of 9):
- Mesoblast (MESO +$0.62 after Thursday’s -$0.03),
- Agenus (AGEN +$0.26 after Thursday’s -$0.07 and Wednesday’s +$0.05),
- Verve Therapeutics (VERV +$0.20 after Thursday’s -$0.29, Wednesday’s +$0.45 and Tuesday’s -$0.51),
- Compass Therapeutics (CMPX +$0.20 after Thursday’s -$0.09, Wednesday’s -$0.11, Tuesday’s +$0.40 and Monday’s +$0.17),
- Regenxbio (+$0.17 after Thursday’s +$0.38)
- Caribou Biosciences (CRBU +$0.12 after Thursday’s -$0.03),
- Lenz Therapeutic (LENZ +$0.05),
- Cellectis SA (CLLS +$0.03),
- Harvard Apparatus RT (OTCQB: HRGN +$0.015 after Thursday’s $0.00, Wednesday’s -$0.07, Tuesday and Monday’s $0.00),
The BOTTOM LINE: a week of calamity of plane crashes, market and sessio volatile moves and pray for those who lost their lives!!
Finally, Friday shifted back to the downside following Thursday’s upside after down shifting on Wednesday, Tuesday and Monday, as I wrote Monday a.m., “Risk versus uncertainty – which is worst?”
- I think it's important just to take a step back, focus on the fundamentals, be selective. I mean, this has definitely NOT been a great Q from a stock-picker standpoint.
Earnings are a-comin’ … from Q4/24 and FY24 are due …
- Alnylam Pharmaceuticals (ALNY)
- Sage Therapeutics (SAGE) - Tuesday, 2/11
- Moderna (MRNA) - Friday, 2/14
Interesting … Underperforming stocks that bounce back in January subsequently decline for the rest of the year. <Wolfe Research – CNBC’ Lisa Han>
- In a Friday note to clients, Wolfe Research found that stocks subject to the January bounce subsequently decline in the months to follow.
- “The so-called January effect/bounce has persisted for many years in which the prior years’ worst performing stocks outperform in the new year as tax loss selling and window dressing abates,” wrote chief investment strategist Chris Senyek. “Most interesting was the subsequent full year performance in such years for the prior years’ worst performing stocks. After the muted January bounce, this cohort experienced middling performance and subsequently underperformed for the entire year.”
- Senyek added that a muted January bounce happened in the years in which the S&P 500 gained 10% or more in the previous year.
January ‘25 recap: understand the “flow” …
- 1/31 – Friday ended with a negative close at the close of 9 incliner, 25 decliners and 1 flat
- 1/30 - Thursday ended with a positive close at the close of 20 incliner, 13 decliners and 2 flats
- 1/29 - Wednesday ended with a negative close at the close of 24 incliner, 9 decliners and 2 flats
- 1/28 – Tuesday ended with a negative close at the close of 14 incliner, 17 decliners and 4 flats
- 1/27 -Monday ended with a negative close at the close of 12 incliner, 21 decliners and 2 flats
- 1/24 – Friday ended with a negative close at the close of 12 incliner, 22 decliners and 1 flat
- 1/23 - Thursday ended with a positive close at the close of 26 incliner, 4 decliners and 5 flats
- 1/22 - Wednesday ended with a positive close at the close of 18 incliner, 14 decliners and 3 flats
- 1/21 - Tuesday ended with a positive close at the close of 28 incliner, 6 decliners and 1 flat
- 1/20 – Markets were closed
- 1/17 - Friday’s advance/decline line ended with a positive close at the close of 21 incliner, 12 decliners and 2 flats
- 1/16 - Thursday’s advance/decline line ended with a negative close at the close of 10 incliner, 22 decliners and 3 flats
- 1/15 - Wednesday’s advance/decline line ended with a positive close at the close of 29 incliner, 3 decliners and 3 flats
- 1/14 - Tuesday’s advance/decline line ended with a negative close at the close of 6 incliner, 26 decliners and 3 flats
- 1/13 - Monday’s advance/decline line ended with a negative close at the close of 11 incliner, 20 decliners and 4 flats
- 1/10 - Friday’s advance/decline line mid-day ended with a negative close at the close of 29 incliner, 2 decliners and 4 flats
- 1/9 - Thursday, markets were closed
- 1/8 - Wednesday’s advance/decline line ended with a negative close at the close of 27 incliner, 27 decliners and 1 flat
- 1/7 - Tuesday’s advance/decline line ended with a barely positive close at the close of 17 incliner, 16 decliners and 2 flats
- 1/6 - Monday’s advance/decline line ended with a positive close at the close of 22 incliner, 12 decliners and 1 flat
- 1/3 - Friday’s advance/decline line ended with a positive close at the close of 30 incliner, 8 decliners and 2 flats
- 1 /2 - Thursday’s advance/decline line ended with a positive close at the close of 21 incliner, 12 decliners and 2 flats
- 1/1 Wednesday, markets were closed
As I have written “Many sector companies are engaged in cost realignment programs, which won’t be realized consequences over the next few Qs where the operating expense levels; spending on SG&A (selling, informational, and administrative) and R&D (research and development) facilitate the need to extend runways and enable expectation of clinical innovations.”
- "I think the market's going to come back to earnings, the first couple of months of 2025, and 1st H/25 will be a shifting cell and gene therapy sector due to earnings releases... I still believe stocks will swing upward pre and them more post releases
Big Point to remember “Think about it; the biggest problem the cell and gene therapy sector it’s all to the future … 99% of them have no earnings!
- If rates are higher for longer, that means that sector companies will continue to struggle or be unable to raise capital and therefore be subject to debt servicing firms!”
- 2024 saw very little life IPOs (initial public offering) market and secondaries – I have seen private investments, mortgages, sell-offs, as companies deferred and struggle to gain further market access i.e., public. <Me>
What could 2025 have in store for the capital access space?
- "You'll see a number of cell and gene therapy comandantes drive for secondaries – they’re desperate for cash, but I do think a lot of cell and gene therapy sector companies NEED to be focused on what is driving their own growth —they're focused on a lot of change BUT … that's happening in pipelines … capital expansion is second.
Why do I keep repeating, so investors can make the connection …
The top three (3) performing in the session:
- Friday: Mesoblast (MESO), Agenus (AGEN) and Verve Therapeutics (VERV)
- Thursday: Alnylam Pharmaceuticals (ALNY), Beam Therapeutics (BEAM) and Ultragenyx Pharmaceuticals (RARE)
- Wednesday: Mesoblast (MESO), Blueprint Medicine (BPMC) and Verve therapeutics (VERV)
- Tuesday: Alnylam Pharmaceuticals (ALNY), Moderna (MRNA) and AxoGen (AXGN)
- Monday: Vericel (VCEL), BioLife Solutions BLFS) and Sage Therapeutics (SAGE)
The worst three (3) in the session:
- Friday: Alnylam Pharmaceuticals (ALNY), Moderna (MRNA) and Blueprint Medicine (BPMC),
- Thursday: BioLife Solutions (BLFS), Verve Therapeutics (VERV) and Blueprint Medicine (BPMC),
- Wednesday: Alnylam Pharmaceuticals (ALNY), Moderna (MRNA) and Ionis Pharmaceuticals (IONS)
- Tuesday: Beam Therapeutics (BEAM), uniQure NV (QURE) and Adverum Biotechnologies (ADVM)
- Monday: Alnylam Pharmaceuticals (ALNY), CRISPR Therapeutics (CRSP) and Blueprint Medicine (BPMC)
Welcome to my world of defining the “grey’ in our universe!
- Right up front, “I also hate to be so negative or contrarian but, this is a NO spin zone and facts are its product; I can always be WRONG but … I am mostly EARLY!”
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 it’s 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.