October 21, 2015 4:58pm
The stem, cell and gene therapy sector is always on the edge between success and failure, respect and humiliation while justifying its existence without revealing the risk of its uncertainties.
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The major averages were mostly lower in afternoon trading Wednesday, weighed down by drug makers. The NASDAQ was down 0.5%, the S&P 500 slipped 0.3%, and the Dow was little changed. Volume on the NYSE and NASDAQ was running higher than Tuesday's level.
The NASDAQ closed DOWN -40.85 or -0.84% to 4,840.12 and the DOW closed DOWN -48.50 or -0.28% to 17,168.61.
Henry’omics:
It's hard not to be captivated by the stem, cell and gene therapy sector! However, a sudden, inexplicable failure of any or one company always drags down the sector as a whole.
- But, it also says that certainty is running out on some of these development platforms!
“Pundits” will read into the lucky or unlucky few who make many forward claims. Then, as mysteriously as they appeared, the SCGT&RM sector wanes in desirability.
- Within these past years of whatever was … that sent investors into frenzy becomes the answer to the froth question.
I-Banks analysts who put forth … detailed knowledge of a development platform; never seem to be on the same page as those who objectively refrain from the salesmanship and outright hyperbole for a platform that has now sent it to the spiral downward.
- Back to reality, the stem, cell, gene therapy and regenerative medicine stocks are and have been lacking major catalysts!
As the SCGT&RM sector open to the upside (this am) and them fell dramatically to the downside at the first half hour to through the first and second hour of the session until the mid-day and then closed negative as yet again, road the indexes and ETFs roller-coaster:
- The iShares Biotechnology Stocks ETF (IBB) closed DOWN -9.98 or -3.16% on Tuesday following Monday’s advance of +1.62 or +0.52%;
- The NASDAQ Biotechnology index (NBI) closed DOWN -1.50 or -0.49% on Wednesday following Tuesday’s decline of -106.24 or -3.21% after Monday’s advance of +18.62 or +0.57%;
- The Russell 2000 (IWM) closed DOWN on Wednesday -1.74 or -1.51% after Tuesday’s -0.16 or -0.14% following Monday’s advance of +0.22 or +0.19%;
- The SPDR SD&P Biotech ETF (XBI) closed DOWN -0.09 or -0.14% following Wednesday’s -2.25 or -3.38% after Monday’s advance of +0.51 or +0.77%
A day in the life of the stem, cell and gene therapy RegMed (SCGT & RM) sector:
The stem, cell, gene therapy and regenerative medicine (SCGT&RM) stocks opened higher and promptly slumped to the downside on Wednesday after Athersys (ATHX) disclosed the end of the Chugai’s “parting of ways”.
- The SCGT & RM equities opened positive with an A/DL of 25/12 and 6 flats dropping to a precipitous negative first half hour A/DL’ of 13/25 and 5 flats keeping to a more negative first hour of an A/DL of 8/31 and 4 flats, a second hour (11:30 am) A/DL of 9/28 and 6 flats accentuating a negative mid-day A/DL of 8/31 and 4 flats.
- The 3 pm advance/decline line (A/DL) road the negative tide 14/27 with 2 flats. The closing bell synched the negativity of the session with an A/DL of 11/31 and 1 flat
How does the old Ben Graham quote go? "In the short run, the market is a voting machine but in the long run it is a weighing machine"? Yeah, well, I think that applies nicely right now to our current situation.
- Volume is still low in respect to the downdraft;
- The iShares Biotechnology ETF (IBB) shed about 2%;
- My fear index, the CBOE Volatility Index (VIX) traded above 16 in contrast to Tuesday’s near 15 having dropped about 33% this month.
A domino effect, when speculators, investors and traders start selling stocks - the fall accentuates scaring “all” to sell even more shares, which further enhances the chain reaction!
- The sector’s venue: “Veniremus, emimus, vendidit” – the new mantra, we came, we bought, we sold!
Dosing the sector – what a day ... for the 43 Patients:
- Open: POSITIVE with 25 decliners, 12 advances and 6 flats;
- 1st half-hour: NEGATIVE with 25 decliners, 13 advancers and 5 flats;
- First full hour (10:30 am): NEGATIVE with 31 decliners, 8 advancers and 4 flats;
- Second hour (11:30 am): NEGATIVE with 28 decliners, 9 advancers and 6 flat;
- Mid-day (12:30 pm): NEGATIVE with 31 decliners, 8 advancers and 4 flats;
- 3 pm: NEGATIVE with 27 decliners, 14 advancers and 2 flats;
- Closing bell: NEGATIVE with 31 decliners, 11 advancers and 1 flat
Wednesday’s trading indications: 3 hit/ 2 miss:
- AxoGen (AXGN) closed DOWN – miss;
- Capricor (CAPR) closed DOWN – hit;
- Kite Pharma (KITE) closed UP – hit;
- Organovo (ONVO) closed DOWN – miss;
- Verastem (VSTM closed UP – hit;
Who is down – top 5:
- Juno therapeutics (JUNO) closed down -$1.23 to $46.69;
- Regenxbio (RGNX) is down -$0.99 to $16.48;
- uniQure (QURE) -$0.54 to $17.24;
- Cellectis ADR (CLLS) -$0.45 to $26.11;
- Fate Therapeutics (FATE) closed down -$0.44 to $3.46;
Who was UP - top 5:
- Spark Therapeutics (ONCE) closed up +$1.59 to $55.94;
- Northwest Bio (NWBO) +$0.60 to $5.28;
- Osiris (OSIR) +$0.51 to $16.99;
- Bluebird bio (BLUE) +$0.15 to $80.78;
- Sangamo (SGMO) is up +$0.13 to $6.42;
Who is flat?
- ReNeuron (RENE.L) at $3.875;
All investments are subject to risks. Investors should consider investment objectives. The information included above as well as individual companies and/or securities mentioned should only construed as an indication from any RMi reviews.
The facts stated and the opinions given in this publication are based on data and information considered to be reliable and have been carefully worked into my analyses and prognoses. However, no guarantee can be given as to their fairness, accuracy or completeness.
Henry McCusker, the editor and publisher of RegMed Investors does not hold or have positions in securities referred to in this publication.
