August 14, 2024 4:43pm

As volatility stays brisk, with me taking a few sessions-off for August vacation days

Is there a “reckoning” coming, there could be a deeper foxhole needed for the sector and markets

I say today what others won't, so you can do what others can't by sticking to the FACTS!

Never leave an investor uninformed!  

The week to date

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

 

Wednesday: The Dow closed UP +242.75 points or +0.62%, the S&P closed UP +20.78 points or +0.38% while the Nasdaq closed UP +4.99 points or +0.03%

Wednesday’s advance/decline line at the open was negative with 9 incliners, 22 declined and 4 flats; ending with a negative close of 6 incliner, 29 decliners and 3 flats

  • the IBB was down -% and the XBI was down -%
  • the VIX was down - point or -% at 16.

Economic Data Docket: Consumer prices increased 2.9% year over year, down from 3% in June and the lowest reading since 2021. Month over month, prices ticked up 0.2%. Economists expected a 0.2% increase from the prior month and a 3% gain year over year.

  • So-called core inflation, which strips out food and energy from the headline number, advanced 0.2% on the month, also in line with expectations.

 

Tuesday: The Dow closed UP +408.63 points or +1.04%, the S&P closed UP +90.04 points or +1.68% while the Nasdaq closed UP +407. points or +2.43%

Tuesday’s advance/decline line at the open was positive with 21 incliners, 11 declined and 3 flats; ending with a positive close of 22 incliner, 10 decliners and 3 flats

  • the IBB was up +1.41% and the XBI was up +1.19%
  • the VIX was down -2.59 point or -12.51% at 18.12

Economic Data Docket: The producer price index, a measure of wholesale inflation, increased 0.1% on the month, less than 0.2% forecast. PPI excluding food and energy was flat. On a year-over-year basis, headline PPI rose 2.2%, a sharp drop from the 2.7% reading in June.

 

(8/12) Monday: The Dow closed DOWN -140.53 points or -0.36%, the S&P closed UP +0.23 points or +0.00% while the Nasdaq closed UP +35.31 points or +0.21%

Monday’s advance/decline line at the open was negative with 9 incliners, 23 declined and 3 flats; ending with a negative close of 13 incliner, 19 decliners and 3 flats

  • the IBB was down -0.43% and the XBI was up +0.28%
  • the VIX was up +0.34 point or +1.67% at 20.71

Economic Data Docket: Wednesday’s consumer price index report for July will be a pivotal clue as to the health of the U.S. economy, and determine if investors will remain uneasy following July’s weak nonfarm payrolls report that contributed to the recent sell-off.

 

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 …

Monday, indexes seesawed but managed to maintain the momentum from late last week as investors braced for key inflation data.

Tuesday, rallied, scaling back closer to the record levels seen last month before a sharp pullback, driven by this week’s first batch of key U.S. inflation data.

  • Volatility has also eased sharply since then. The Cboe Volatility Index (VIX) hovered below 20 on Tuesday after surging above 65 last week.

Wednesday, indexes ticked-up after the release of U.S. inflation data as the cell and gene therapy sector crashed.

  • All 3 major averages are now above their Aug. 2 closing level, which was the session before the global market sell-off on Aug. 5 that appeared to be related to an unwind of the yen carry trade and concerns about economic growth.

 

52-week low:

  • bluebird bio (BLUE) at $0.84
  • Editas Medicine (EDIT) at $3.78
  • Verve Therapeutics (VERV) at $4.47

 

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

Q3/24

  • August: 2 positive and 6 negative closes
  • July: 1 market holiday. 1 day off, 6 negative, 1 neutral and 12 positive closes

 

Wednesday’s Closing Down (10 of 29):

  • Alnylam Pharmaceuticals (ALNY -$4.74 after Tuesday’s -$2.55 after Monday’s +$0.66),
  • CRISPR Therapeutics (CRSP -$1.81 after Tuesday’s +$1.31),
  • Beam Therapeutics (BEAM -$0.98 after Tuesday’s +0.36 after Tuesday’s -$0.48),
  • Intellia Therapeutics (NTLA -$0.90 after Tuesday’s +$0.64 after Tuesday’s +$0.31),
  • Vericel (VCEL -$0.67 after Tuesday’s +$0.53 after Tuesday’s -$0.15).
  • BioLife Solutions (BLFS -$0.62 after Tuesday’s +$0.72 after Monday’s +$0.55),
  • AxoGen (AXGN -$0.51 after Tuesday’s +$0.39 after Monday’s -$0.15),
  • Regenxbio (RGNX -$0.38 after Tuesday’s +$0.36 after Tuesday’s +$0.27),
  • uniQure NV (QURE -$0.34 after Tuesday’s -$0.18 after Monday’s +$0.07),
  • Adverum Biotechnologies (ADVM -$0.31 after Tuesday’s +$0.27),

Flat (3):

  • Bellicum Pharmaceuticals (BLCM)
  • Harvard Apparatus RT (OTCQB: HRGN $0.00 after Tuesday’s +$0.22),
  • Homology Medicine (FIXX)

Wednesday’s Closing Up (6 of 6):

  • Solid Biosciences (SLDB +$1.06),
  • Blueprint Medicine (BPMC +$0.54 after Tuesday’s -$0.89 after Monday’s -$0.19),
  • Lenz Therapeutics (LENZ +$0.33 after Tuesday’s -$0.01 after Monday’s -$0.60),
  • Mesoblast (MESO +$0.16 after Tuesday’s -$0.06 after Monday’s +$0.21),
  • Caribou Biosciences (CRBU +$0.04),
  • Precigen (PGEN +$0.03),

 

The BOTTOM LINE: The cell and gene therapy sector was greeted this morning with July's Consumer Price Index (CPI), which luckily happened to be in line with economist forecasts and showed inflation continuing to cool.

  • Summer has proven itself to be a wild season for markets, with high highs, low lows, and serious talk of more volatility and woes. <Yahoo Finance>

The recent jolts of volatility this week reverberated again with Wednesday’s decline after Tuesday’s incline after Monday after Friday declined and Thursday’s incline after drooping on Wednesday following Tuesday’s pop and Monday’s decline in a new week …

  • The small-cap Russell 2000 fell 0.8%
  • The yield on the benchmark 10-year Treasury note fell three basis points to 3.82%.
  • volume on the Nasdaq was lower

 

The up/downs in sessions could be a preview of the rest of the month, quarter and year …

  • Economic concerns, geopolitical conflict and the looming November elections could keep investors on edge in the coming months.

 

August is historically a rocky month for the stock market due to lighter trader volumes.

  • As Q2 earnings numbers sweep … hold tight more earnings numbers on the way, we can NOT battle the downslide!

 

As “uncle algo and his electronic dwarfs” artillery barraged share pricicing  to the downside, the cell and gene therapy sector dive into the foxhole!

 

“It may not have been as cool as yesterday’s PPI, but today’s as-expected CPI likely won’t rock the boat. Now the primary question is whether the Fed will cut rates by 25 or 50 basis points next month.”

  • “Futures market pricing is roughly split down the middle between expectations for a quarter or half-percentage point reduction at central bank meeting on Sept.17-18, and forecast a total basis point in shifts by the end of the year, per the CME FedWatch Tool. If most of the data over the next five weeks points to a slowing economy, the Fed may cut more aggressively.” <Chris Larkin, managing director of trading and investing for E-Trade from Morgan Stanley Larkin>

 

Reiterating, “There’s more room for “tactical downside in the weeks to come as we enter the gauntlet of the weakest two months and only consecutive losing months for equities, with markets at all-time highs.”

 

Q3 and August to date:

  • Wednesday ended with a negative close of 6 incliner, 29 decliners and 3 flats
  • Tuesday ended with a positive close of 22 incliner, 10 decliners and 3 flats
  • Monday ended with a negative close of 13 incliner, 19 decliners and 3 flats
  • Friday ended with a negative close of 9 incliner, 24 decliners and 2 flats
  • Thursday ended with a positive close of 26 incliner, 6 decliners and 3 flats
  • Wednesday ended with a negative close of 2 incliner, 31 decliners and 2 flats
  • Tuesday ended with a positive close of 23 incliner, 9 decliners and 3 flats
  • Monday ended with a negative close of 1 incliner, 31 decliners and 3 flats
  • Friday ended with a negative close of 5 incliners, 28 decliners and 2 flats
  • Thursday ended with a negative close of 4 incliners, 29 decliners and 2 flats

 

Electronic trading pops and flops the cell and gene therapy sector

  • There is past evidence of a slowdown coming (it’s the contrarian in me) and it's going to become even more thin as we go forward into Q2 earnings season

 

Due “dates” for Q2 LPS (loss per-share) earnings releases:

  • Lenz Therapeutics (LENZ) Wednesday, 8/14
  • Precigen (PGEN) Wednesday, 8/14

 

The top three (3) performing in the session: 

  • Wednesday: Solid Biosciences (SLDB), Blueprint Medicine (BPMC) and Lenz Therapeutics (LENZ),
  • Tuesday: CRISPR Therapeutics (CRSP), Ultragenyx Pharmaceuticals (RARE) and BioLife Solutions (BLFS)
  • Monday: Ultragenyx Pharmaceuticals (RARE), Alnylam Pharmaceuticals (ALNY) and BioLife Solutions (BLFS)

The worst three (3) in the session: 

  • Wednesday: CRISPR Therapeutics (CRSP), Alnylam Pharmaceuticals (ALNY) and Beam Therapeutics (BEAM)
  • Tuesday: Alnylam Pharmaceuticals (ALNY), Blueprint Medicine (BPMC) and Agenus (AGEN)
  • Monday: Lenz Therapeutics (LENZ), Beam Therapeutics (BEAM) and Verve Therapeutics (VERV)

 

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.