May 24, 2016 6:46am

 

It difficult to identify the avenues of momentum that drive change in RegMed sector open and closes, but it appears that expectations are mostly ambiguous

 

Indexes and ETFs: the XLV and IWM are flat and the IWM and XBI are up

Investing actions: BLUE, HSGX, KOOL, XON and VSTM

 

I say today what others won't, so you can do what others can't; whether information or intelligence is good, bad or somewhere in between – it defines the who, when, where, which and what of it …

 

 

 

Where are today’s markets going? 

 

Dow futures are UP +0.23 % and NASDAQ futures are UP +0.32%

 

U.S. stock futures on Tuesday pointed to a modestly higher open as investors stay locked in wait-and-see mode, but still putting the market on track to bounce back from the previous day’s dip.

European stocks were trading higher following a shaky start to the trading session.

Asian markets traded broadly lower, led by declines in Japan and China, as investors await further cues from next month's U.S. Federal Reserve monetary policy meeting.

Data docket: An April figure for new-home sales is slated to hit at 10 a.m. ET, with economists forecasting a reading of 523,000.

 

 

The stem, cell and gene therapy regenerative medicine (SCGT&RM) sector closed POSITIVE on Monday and Friday, NEGATIVE on Thursday, POSITIVE on Wednesday and NEGATIVE on last Tuesday.

 

The stem, cell and gene therapy regenerative medicine sector’s record after the last 5 days (of 43 covered companies):

  • Monday closed POSITIVE with 12 decliners, 26 advancers and 5 flats;
  • Friday closed POSITIVE with 10 decliners, 31 advancers and 2 flats;
  • Thursday closed NEGATIVE with 35 decliners, 5 advancers and 3 flats;
  • Wednesday closed POSITIVE with 15 decliners, 25 advancers and 3 flats;
  • Last, Tuesday closed NEGATIVE with 26 decliners, 13 advancers and 4 flats;

 

 

Remembering Monday’s post, “Staying cautious is wise for short-term investors, as “our” universe will not likely have any huge jumps overnight without being dumped in a day or two as it’s more about net movements by the week.”

  • Whatever the rest of 2016 holds, contrarian investors are experiencing good days.

SCGT&RM stocks are back in the probable area, although investors can depend on one aspect of stock prices – fundamentals are undershot.

  • Extrapolating recent trading ranges point (both positive and negative) into the future; mispricing’s are exposed, valuations destabilized and  mean reversion suggests that the lack of return moves back towards the average over time – thus don’t expect much.

 

 

You’ve made it to the office, turned on the monitor, having just gotten your coffee and it hits you - what could be today’s trades? 

Watch list:

  • The iShares Nasdaq Biotechnology (IBB) closed Monday up +0.70% and is FLAT in Tuesday’s pre-market;

 

  • The SPDR S&P Biotech ETF (XBI) closed Monday up +1.35%  and is UP +0.19% in Tuesday’s  pre-market;

 

  • NASDAQ Biotechnology (NBI) closed up Monday +0.62%;

 

  • The Health Care Select Sector SPDR ETF (XLV) closed down Monday -0.40% and is FLAT in Tuesday’s pre-market;

 

  • The iShares Russell 2000 (IWM) closed Monday down -0.12% and is UP +0.17% in Tuesday’s pre-market.

 

 

Companies in the spotlight;

bluebird bio (BLUE) closed UP +$1.79 to $42.39 following Friday’s +$1.77. Thursday’s price was $38.83, following the rest of the weeks, $39.39, $38.91and the previous Friday’s $38.46. Every time we see a good rise in the shares it’s like a carousel buy in, sell out, and buy in again – Maintaining SELL;

Cesca Therapeutics (KOOL) closed DOWN -$0.25 to $2.89 after Friday’s -$0.47 following Thursday’s UP of +$1.60 on the basis of one (1) patient treated. One patient does NOT make a TRIAL a success … but, it has made the company a target for a sell-off!  Be ready for a downward SLIDE … Maintaining  SELL;

Histogenics (HSGX) closed UP +$0.05 to $1.86 following Friday’s -$0.03 after Thursday’s -$0.13. HSGX is trading for less than its cash position of $2.34. Oversold – Maintaining BUY;

Intrexon (XON) closed UP +$1.54 to $29.59 after Friday’s +1.52. The Zika virus scare continues; just last week, the number of people reported to have the virus in Brazil has topped 1.5 million.  The World Health Organization has also declared Zika a global health crisis. The risk is real, the closest we are to a vaccine is a P1 as announced by Dr. Tony Fauci, the head of the NIH/AID – then we have to rely on the spraying and many are up on arms about that but, I don’t see any more immediate applications to stop the progression of the Zika virus.  The after-market indication was +$0.26 – Maintaining BUY

Verastem (VSTM) closed FLAT at to $1.43. The stock is trading for less than its value of $2.69 – Maintaining BUY

 

 

Opinions expressed are those of the author and are subject to change, and are 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.

Henry McCusker, the editor and publisher of RegMed Investors does not hold or have positions in securities referred to in this publication.