June 25, 2024 4:33pm

Breadth indicators must improve significantly to confirm any sustainable sector rotation

It’s coming, the end of Q2 and 1stH (half) as Q3’s summer doldrums typically record as the worst period for “our” universe

I say today what others won't, so you can do what others can't!

Never leave an investor uninformed! 

I follow the dictum, quoting Churchill that “short words are best, and the old words when short are best of all.”

 

Tuesday: The Dow closed DOWN -299.05 points or -0.76%, the S&P closed UP +21.43 points or +0.39% while the Nasdaq closed UP +220.84 points or +1.26%

 

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 …

Indexes were mixed pulled in opposite directions by the Nasdaq and the Dow.

The wait is on for Friday's update to the Personal Consumption Expenditures (PCE) index, a favored inflation input for the Federal Reserve.

Fed Governor Michelle Bowman on Tuesday stressed she's willing to hike interest rates if holding them steady fails to bring price pressures under control.

Economic Data Docket: Consumer confidence edged lower in June as did their near-term outlook for business conditions, the board’s confidence index moved down to 100.4, slightly below the 101.3 in May but a touch better than the Dow Jones estimate for 100. The Present Situation Index rose slightly to 141.5 while the Expectations Index decreased to 73.

  • In other economic news, the Richmond Federal Reserve’s manufacturing index slumped to -10 in June, down from zero in May and worse than the estimate for -0.5.
  • Home prices set a new record high in April although annual growth slowed from the previous month, according to the S&P CoreLogic Case-Shiller report.

 

Metrics & Advance/Decline (A/D) Line:

Tuesday’s advance/decline line at the open was negative with 10 incliner, 20 decliners and 5 flats; ending with a negative close of 11 incliners, 22 decliners and 2 flats

  • the IBB was down -0.43% and the XBI was down -0.70%
  • the VIX down -0.41 point or -3.08% at 12.92

Monday’s advance/decline line at the open was positive with 22 incliner, 9 decliners and 4 flats; ending with a positive close of 24 incliners, 8 decliners and 3 flats

  • the IBB was up +1.91% and the XBI was up +1.60%
  • the VIX was up +0.13 point or +0.98% at 13.33

 

Ebb and flow of MY covered sector cell and gene therapy session daily “endings”:

  • June: 1 market holiday, 6 positive and 10 negative closes

 

Tuesday’s Closing Down (10 of 22):

  • CRISPR Therapeutics (CRSP -$1.99 after Monday’s +$1.70),
  • Vericel (VCEL -$1.30 after Monday’s +$1.19) 
  • Intellia Therapeutics (NTLA -$1.00 after Monday’s +$0.78),
  • Solid Biosciences (SLDB-$0.82),
  • Sage Therapeutics (SAGE -$0.66),
  • Beam Therapeutics (BEAM -$0.58 after Monday’s +$1.89),
  • Regenxbio (RGNX -$0.47 after Monday’s +$0.77),
  • Lenz Therapeutics (LENZ -$0.44 after Monday’s -$0.28),
  • Agenus (AGEN -$0.36 after Monday’s +$0.67),
  • Prime Medicine (PRME -$0.35),

Flat (2):

  • Bellicum Pharmaceuticals (BLCM) – dropped)
  • Homology Medicine (FIXX) – under $1.00

Tuesday’s Closing Up (11 of 11):

  • Alnylam Pharmaceuticals (ALNY +$17.26 after Monday’s +$57.20
  • Ionis Pharmaceuticals (IONS +$2.32 after Monday’s +$2.85),
  • Blueprint Medicine (BPMC +$0.45 after Monday’s +$1.87)
  • Ultragenyx Pharmaceuticals (RARE +$0.43 after Monday’s -$0.18)
  • Harvard Apparatus RT (OTCQB: HRGN +$0.25 with 100 shares traded)
  • Adverum Biotechnologies (ADVM +$0.07),
  • Precigen (PGEN +$0.06),
  • AxoGen (AXGN +$0.05),
  • Generation Bio (GBIO +$0.94),
  • Cellectis SA (CLLS +$0.02),
  • Brainstorm Cell Therapeutics (BCLI +$0.0119),

 

The month to date:

  • Tuesday ended with a negative close of 11 incliners, 22 decliners and 2 flats
  • (6/24) Monday ended with a positive close of 24 incliners, 8 decliners and 3 flats

 

The BOTTOM LINE: Never overlook the ripple effect of positive/negative spurts in the sectors daily sessions.

I have written to become more cautious on sector equities on Monday…

  • “Investors need to reassess their portfolio strategies… as I had stated: We are also about to see share pricing rotation or profit taking as Q2 and 1st H (first half) ends this Friday and as sector companies prepare for LPS (loss-per-share) quarterly earnings releases.  So, what are share pricing themes that investors can be comfortable with for a short or near- term time horizon i.e., Q3?” <me>

 

The convergence of risks ties share pricing, inflation-oriented releases, politics, trading with the lack of news has only increased the concern about short and near-term performance.

 

Let get to 3 things that you need to know for Wednesday as you prep for the next trading day …

  • 4th week—1 positive and 1 negative closes
  • 3rd week of June, the cell and gene therapy sector experienced 1 market holiday, 3 negative closes and ended Friday with a positive close as options were covered
  • 2nd week of June … negative closes on Friday and Thursday after Wednesday ascended positively as Tuesday drifted lower, retreating from Monday’s highs.
  • 1st week of June: Friday and Thursday ended in the toilet after Wednesday’s positive close Tuesday negative close following Monday’s positive close.

 

The top three (3) performing in the session:   

  • Tuesday: Alnylam Pharmaceuticals (ALNY), Ionis Pharmaceuticals (IONS) and Blueprint Medicine (BPMC)  
  • Monday: Alnylam Pharmaceuticals (ALNY), Ionis Pharmaceuticals (IONS) and Beam Therapeutics (BEAM)

The worst three (3) in the session:   

  • Tuesday: CRISPR Therapeutics (CRSP), Vericel (VCEL) and Intellia Therapeutics (NTLA)  
  • Monday: Lenz Therapeutics (LENZ), Ultragenyx Pharmaceuticals (RARE) and Mesoblast (MESO)

 

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.