January 26, 2016 12:50pm
Significant intraday swings in both directions create skepticism and short-term trading while inhibiting a near –term focus
Valuation metrics are playing into these moves. But they are frequently the tail of the dog. In other words, if valuation is driving your views of the future, instead of the future driving your views on valuation, you’re doing it wrong. Subscribe … http://www.regmedinvestors.com/create-account
Stem, cell and gene therapy and RegMed investors have temporarily lost their compass. Right now, they are still questions on whether “our” universe can sustain gains as volatility pressures still abound, and I think investors are feeling dislocated while sentiment bounces.
U.S. stocks traded higher Tuesday, helped by a bounce in oil and some earnings beats, ahead of the release of the Fed meeting statement Wednesday. The Dow added more than 250 points, with the NASDAQ gaining more than 1% in midday trade.
The mid-day NASDAQ is UP +55.92 or +1.24% to 4,574.53 and the DOW is also UP +292.35 or +1.84% to 16,177.57.
The mid-day voice in the life of the stem, cell and gene therapy RegMed (SCGT & RM) sector – the advance/decline line scenario …
- Tuesday, the stem, cell and gene therapy RegMed sector opened negative with an A/DL of 9/32 and 2 flats while the mid-day was also negative with an A/DL of 18/23 and 2 flats.
The stem, cell and gene therapy RegMed (SCGT&RM) sector opened negative, slipped positive at the mid-day (of 43 covered companies).
- Blame the machine <algorithms> for oil’s uncanny connection to stocks? Oil and stocks continue to trade in tandem, defying their historical relationship and perplexing many analysts and investors. Increasingly, observers are looking to automated trading algorithmic programs to explain the phenomenon!
It’s tough to be right, as I had suggested after quick share price rises in the SCGT&RM sector stocks that investors get … defensive by raising some cash, maybe halving the total number of gaining positions and then adding new shorts and putting hedges in the next months through 2016.
- The iShares Nasdaq Biotechnology ETF (IBB) dipped 2% in morning trade.
A lot of technical damage has been done over the last few weeks, and sector “participants” have their work cut out for them in delivering a message of future appreciation.
- “Our” universe should be bracing for a grim financial reporting season, notice I didn’t earnings!
Reiterating, I can't find a whole bunch of “names” to get thrilled about just yet.
The “hammer and the nail”:
- Applied Genetic Technologies (AGTC -$0.28 or -1.74%) is following its norm of falling post a few up days;
- Athersys (ATHX +$0.019 or +1.69%) will this equity ever reward as its history of failures inhibits real appreciation reality;
- AxoGen (AXGN +$0.24 or +5.19%) floats like a butterfly and regains some height;
- BioLife Solutions (BLFS -$0.02 or -1.01%) is feeling the effect of believing their own “BS”;
- BioTime (NYSEMKT: BTX -$0.11 or -4.30%) should be seeking to define the interlocking relationships of its subsidiaries to future appreciation. Repricing warrants is not a totally fulfilling response;
- Caladrius Bioscience (CLBS -$0.0358 or -5.72%) shouldn’t get any respect until CEO Mazzo realizes he has lost control of his shareholders as if he ever had it;
- Cytori (CYTX -$0.0038 or -2.09%) needs to reverse and balance out its listing as a good trial advances after all the issues;
- Capricor (CAPR -$0.20 or -$8.89%) is still a falling knife, why hasn’t this BOD review the capabilities of the CEO to manage its peripatetic share price. March of ’15, the shares were priced at $10.25;
- Cellectis (CLLS +$0.60 or +2.53%) has been overlooked and oversold TOO long;
- Harvard Apparatus RT (HART -$0.22 or -10.91%) also follows the norm of reliance on day traders and a lack of investor communication;
- Fate Therapeutics (FATE -$0.08 or -3.25%) is feeling the fickle slice of trading fingers;
- Juno Therapeutics (JUNO -$0.96 or -2.95%) and Kite Pharma (KITE - $0.38 or -0.76%) shares are down based on the publication of the allogenic T-cell therapy study by Dr. James Kochenderfer and colleagues at the National Institutes of Health in the current issue of the Journal of Clinical Oncology;
- Ocata therapeutic (OCAT -$0.01 or -0.12%) is still caught in the dilemma of being acquired or not – CEO Wooten shouldn’t have ignored his shareholders. Make their wallets fatter than his own;
My fear gauge or the CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market traded
· Tuesday traded below 23;
· Monday traded near 24;
Dosing the sector – what a day for the 43 Patients:
- The market opened: NEGATIVE with 32 decliners, 9 advancers and 2 flat;
- 1st hour (10:30 am): NEGATIVE with 30 decliners, 12 advancers and 1 flat;
- 2nd hour (11:30 am) NEGATIVE with 28 decliners, 15 advancers and 0 flat;
- The mid-day (12:30 pm: NEGATIVE with 23 decliners, 18 advancers and 2 flats;
Review the intricacies of cause and causation!
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.