August 16, 2024 5:48pm

Volatility continues into a "seasonally challenged part of the year" and into election season

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 in review

 

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

 

Friday: The Dow closed UP +96.70 points or +0.24%, the S&P closed UP +11.03 points or +0.20% while the Nasdaq closed UP +37.22 points or +0.21%

  • Indexes rose on Friday as investors closed out the best week of 2024, part of a market comeback from a violent rout to begin August.
  • For the week, the Dow advanced 2.9%, the S&P 500 added nearly 3.9%, its best week since November 2023 and the Nasdaq gained 5.2%.

Friday’s advance/decline line at the open was negative with 12 incliners, 20 declined and 3 flats; ending with a neutral close of 15 incliner, 15 decliners and 5 flats

  • the IBB was DOWN -0.07% and the XBI was UP +0.06%
  • the VIX was down -0.43 point or -2.82% at 14.80

Economic Data Docket: a Commerce Department report showed housing starts at 1.238 million and building permits at 1.396 million last month. Economists forecast 1.34 million and building permits at 1.42 million in July, both lower than June.

  • University of Michigan sentiment index(survey) increased to 67.8, up from 66.4 in July and better than the Dow estimate for 66.6. However, the current conditions index slumped to 60.9, its lowest since December 2022

 

Thursday: The Dow closed UP +554.57 points or +1.39%, the S&P closed UP +88.01 points or +1.61% while the Nasdaq closed UP +401.89 points or +2.34%

  • Indexes rallied on Thursday as investors regained confidence in the economy following encouraging consumer and labor data that helped ease recession worries.
  • Solid retail sales and claims data is a reminder that the sky is not falling on the U.S. economy. Economic momentum has cooled, but we don’t appear to be headed for recession imminently.”

Thursday’s advance/decline line at the open was positive with 25 incliners, 6 declined and 4 flats; ending with a positive close of 23 incliner, 9 decliners and 3 flats

  • the IBB was UP +% and the XBI was UP +%
  • the VIX was down - point or -% at 23.

Economic Data Docket: Retails sales increased 1% in July, far surpassing an estimate that forecast a 0.3% uptick. Also separately, weekly jobless claims fell for the week.

 

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, 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.

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, 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.

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

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 …

  • Indexes coasted to the close of its best week since November.
  • A quiet calendar greeted investors on Friday, with the main data release showing consumer sentiment ticked higher in August, rebounding for the 1st time in 5 months. 
  • The Russell 2000 reversed and moved 0.3% higher today as volume was lower on the Nasdaq versus the same time Thursday.

 

52-week low:

  • bluebird bio (BLUE) at $0.68

 

Q2/24 Earnings:

RegMed Investors (RMi) - Q2/24 Cell and Gene Therapy Earnings Scorecard Results

… https://www.regmedinvestors.com/articles/11628

 

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

Q3/24

  • August: 1 neutral, 4 positive and 7 negative closes
  • July: 1 market holiday. 1 day off, 6 negative, 1 neutral and 12 positive closes

 

Friday’s Closing Down (10 of 15):

  • Blueprint Medicine (BPMC -$2.03 after Thursday’s +$2.16, Wednesday’s +$0.54, Tuesday’s -$0.89 and Monday’s -$0.19),
  • CRISPR Therapeutics (CRSP -$1.00 after Thursday’s +$2.44, Wednesday’s -$1.81 and Tuesday’s +$1.31),
  • Beam Therapeutics (BEAM -$0.43 after Thursday’s +$1.50, Wednesday’s -$0.98, Tuesday’s +0.36 after Monday’s -$0.48),
  • Intellia Therapeutics (NTLA -$0.24 after Thursday’s +$1.36, Wednesday’s -$0.90, Tuesday’s +$0.64 and Monday’s +$0.31),
  • Ionis Pharmaceuticals (IONS -$0.21 after Thursday’s -$0.19),
  • Regenxbio (RGNX -$0.16 after Thursday’s +$0.48, Wednesday’s -$0.38, Tuesday’s +$0.36 and Monday’s +$0.27),
  • Sage Therapeutics (SAGE -$0.16 and Thursday’s +$0.28),
  • Prime Medicine (PRME -$0.15),
  • Generation BIO (GBIO -$0.14 and Thursday’s +$0.31),
  • uniQure NV (QURE -$0.12),

Flat (5):

  • Bellicum Pharmaceuticals (BLCM)
  • Compass Therapeutics (CMPX)
  • Editas Medicine (EDIT)
  • Harvard Apparatus RT (OTCQB: HRGN $0.00 after Thursday’s $0.00 after Wednesday’s $0.00 after Tuesday’s +$0.22),
  • Homology Medicine (FIXX)

Friday’s Closing Up (10 of 15):

  • Alnylam Pharmaceuticals (ALNY +$5.54 after Thursday’s -$0.19, Wednesday’s -$4.74, Tuesday’s -$2.55 and Monday’s +$0.66),
  • Ultragenyx Pharmaceuticals (RARE +$1.32 and Thursday’s -$0.03),
  • AxoGen (AXGN +$0.71),
  • Adverum Biotechnologies (ADVM +$0.29),
  • Mesoblast (MESO +$0.26 after Thursday’s -$0.07, Wednesday’s +$0.16, Tuesday’s -$0.06 and Monday’s +$0.21),
  • Lenz Therapeutics (LENZ +$0.16 after Thursday’s -$0.90, Wednesday’s +$0.33, Tuesday’s -$0.01 and Monday’s -$0.60),
  • Vericel (VCEL +$0.14 after Thursday’s +$0.83, Wednesday’s -$0.67, Tuesday’s +$0.53 and Monday’s -$0.15)
  • Agenus (AGEN +$0.11 after Thursday’s +$0.59),
  • BioLife Solutions (BLFS +$0.09 after Thursday’s -$0.14, Wednesday’s -$0.62, Tuesday’s +$0.72 and Monday’s +$0.55),
  • Cellectis SA (CLLS +$0.0449),

 

The BOTTOM LINE: Summer has proven itself to be a wild week for markets, with highs, lows, and neutral closes.

  • As “uncle algo and his electronic dwarfs” wobbled pricing neutral, pumped 2 sessions and dumped2 sessions of the cell and gene therapy sector’s share pricing!

 

The recent jolts of volatility this week slowed with the sector’s Friday neutral close after Thursday’s positive close following Wednesday’s negative close, Tuesday’s positive close and Monday’s negative close …

  • After last Friday declined and the previous Thursday’s incline after drooping on Wednesday following Tuesday’s pop and Monday’s decline in a new week …

 

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 … LPS (loss-per-share) numbers, a few more earnings numbers on the way!
  • “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:

  • Friday ended neutral with 15 incliners, 15 decliners and 5 flats
  • Thursday ended with a positive close of 23 incliner, 9 decliners and 3 flats
  • 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
  • (8/12) 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
  • (8/5) 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
  • (8/1) 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

 

The top three (3) performing in the session: 

  • Friday: Alnylam Pharmaceuticals (ALNY), Ultragenyx Pharmaceuticals (RARE) and AxoGen (AXGN)
  • Thursday: CRISPR Therapeutics (CRSP), Blueprint Medicine (BPMC) and Beam Therapeutics (BEAM)
  • 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: 

  • Friday: Blueprint Medicine (BPMC), CRISPR Therapeutics (CRSP) and Beam Therapeutics (BEAM)
  • Thursday: Lenz Therapeutics (LENZ), Alnylam Pharmaceuticals (ALNY) and Ionis Pharmaceuticals (IONS)
  • 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.