January 29, 2016 5:38pm

 

Buying value in this oversold sector is opportunistic and company specific …

 

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RegMed Investors’ willingness to provide the facts in evidence gets results that have surfaced reality and veracity.  

 

 

U.S. stocks closed more than 2% higher percent Friday, the last trading day of January, after the Bank of Japan unexpectedly adopted a negative interest rate policy for the first time. Encouraging earnings reports, a better-than-expected Chicago PMI report and some stabilization in oil prices also helped push equities higher.  The major averages still ended sharply lower for the month, with the NASDAQ down 7.86% for its worst month since May 2010. Friday's sharp gains pushed the three (3) indexes into positive territory for the week.

The mid-day NASDAQ closed UP +107.28 or +2.38% to 4,613.95 and the DOW is also UP +396.30 or +2.47% to 16,466.30.

 

 

A day in the life of the stem, cell and gene therapy RegMed (SCGT & RM) sector – the advance/decline line scenario …

  • Friday, the stem, cell and gene therapy RegMed sector opened positive with an A/DL of 20/17 and 6 flat while the mid-day was also positive with an A/DL of 26/14 and 3 flats while the closing bell rang with another positive A/DL of 32/8 and 3 flats.

 

 

My pet peeve:

  • High-frequency trading accounted for 49% of January's daily trading volume of about 9.26 billion shares <according to TABB Group>.                                                                              

 

 

Henry’omics:

The stem, cell and gene therapy RegMed (SCGT&RM) sector opened positive, stayed positive at the mid-day  and closed positive (of 43 covered companies).

  • The sessions shows me … a pennies upside for the majority of the “usual suspects” with few of the oversold flashing their upside value.

My pattern analysis supported a rally but, I expect downside follow-through next week on the back of today’s strength. MY bias suggests that today’s strength reduced the week’s depreciation but, the risk is still permeating below the surface!

  • The iShares Biotechnology Index ETF (IBB), which tracks the NASDAQ Biotech Index, has been hammered since the beginning of 2016. It's fallen almost 15% in a matter of weeks.

Today, the iShares Nasdaq Biotechnology ETF (IBB) turned higher to close up 1.4% higher.

  •  “Our” universe has appreciated however, investor confidence in the SCGT&RM sector remains low because of a variety of factors, leaving a volatile and somewhat scattered landscape for those trying to game any sort of return beyond a day’s run.

What I see is a low volume reversal and a retesting on momentum that previous day’s lows were really … the low.  Volatility will persist, but is still part of the problem!

  • SCGT&RM investors do NOT know where to invest, since appreciation direction does NOT define any route! Traders and programs are still ruling the day’s session …

Risk exposure is still an issue.

 

 

My fear gauge or the CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market traded

·         Friday traded below 20.5;

·         Thursday closed near 22.5;

·         Wednesday traded near 23;

·         Tuesday traded near 22.5

·         Monday traded near 24;

 

 

Dosing the sector – what a day for the 43 Patients:

  • The market opened: POSITIVE with 17 decliners, 20 advancers and 6 flats;
  • The mid-day (12:30 pm:  POSITIVE with 14 decliners, 26 advancers and 3 flat;
  • Closing bell: POSITIVE with 8 decliners, 32 advancers and 3 flats

 

 

Friday’s indications – 2 hits and 1 miss:

  • Cytori Therapeutics, (CYTX) closed down – hit;
  • Fate Therapeutics (FATE) closed DOWN – miss;
  • Intrexon (XON) closed UP – hit;

 

 

Riding the indexes and ETFs roller-coaster:

·         The iShares Biotechnology Stocks ETF (IBB) closed UP on Friday +3.58 or +1.36%

·         Thursday’s -9.93 or -3.66%

·         Wednesday’s -8.68 or -3.08%

·         Tuesday’s decline of -1.12 or -0.40%

·         Monday’s decline of -4.82 or 1.67%;

The NASDAQ Biotechnology index (NBI) closed UP on Friday +39.03 or +1.42%

·         Thursday -100.32 or -3.51%;

·         Wednesday’s -93.67 or -3.17%;

·         Tuesday’s -12.78 or -0.43%;

·         Monday’s -49.67 or -1.65%

The Russell 2000 (IWM) closed UP on Friday +3.27 or +3.28%

·         Thursday’s -0.02 or -0.02%;

·         Wednesday‘s -1.39 or -1.37%;

·         Tuesday’s advance of +1.99 or +2%;

·         Monday’s decline of -2.255 or -2.22%;

The SPDR SD&P Biotech ETF (XBI) closed UP on Friday +0.84 or +1.69%

·         Thursday -1.94 or -3.76%;

·         Wednesday’s -2.48 or -4.58%;

·         Tuesday’s -0.38 or 0.70%;

·         Monday’s decline of -0.82 or -1.48%

 

 

Who was DOWN – only 8?

  • Aduro Biotech (ADRO) closed down -$0.62 to $14.48;
  • Sangamo (SGMO) -$0.30 to $6.05;
  • Fate Therapeutics (FATE) -$0.045 to $2.155;
  • Verastem (VSTM) -$0.05 to $1.20;
  • Cesca Therapeutics (KOOL) -$0.029 to $0.254;
  • ImmunoCellular (NYSEMKT: IMUC) -$0.0124 to $0.23;
  • Caladrius Biosciences (CLBS) -$0.01 to $0.55;
  • Cytori (CYTX) -0.00 to $0.19;

 

 

Who was FLAT?

  • ReNeuron (RENE.L) at $2.875;
  • VistaGen (VSTA) at $8.50;
  • Vericel (VCEL) at $2.11

 

 

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.