October 1, 2024 4:34pm

“Uncle algo and his electronic trading dwarfs” sold into and out of their positions as volatility destabilized October beginning with Iran missile strike, hurricane Helene deaths/damage and port strike strains confidence

The Cboe Volatility Index (VIX) spiked above 19, hitting its highest level since 9/11, as traders sought safety amid growing tensions in the Middle East

October has a troubling history for markets. It’s known as a time of extreme volatility

Never leave an investor uninformed!  

On point, short on words, long on facts and being judicious!

 

Tuesday: The Dow closed DOWN -473.18 points or -0.41%, the S&P closed DOWN -53.73 points or -0.93% while the Nasdaq closed DOWN -278.81 points or -1.53%

  • Iran attack on Israel
  • Traders were also monitoring a strike by members of the International Longshoremen’s Association on the East and Gulf Coasts; while consumers may not feel the pinch immediately, the stoppage could cost the U.S. economy hundreds of millions of dollars.                           

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 …

  • The Labor Department’s Job Openings and Labor Turnover Survey showed that new positions rose to just over 8 million, an increase of 329,000 from July and better than the Dow Jones estimate for 7.7 million. The rate as a share of the labor force rose to 4.8%, up 0.2 percentage point.
  • However, hiring declined by 99,000 to 5.32 million, though total separations tumbled below 5 million for the first time since August 2020, putting the separations rate at 3.1%, tied for the lowest since December 2012.
  • The ISM manufacturing reading for September came in unchanged at 47.2%, representing the share of companies reporting expansion. That was slightly below the 47.5% forecast. The employment, inventories and prices indexes all showed declines, while the production measure rose. <CNBC>

Tuesday’s advance/decline line at the open was negative with 3 incliners, 30 decliners and 2 flats; ending with a negative close at the close of 5 incliner, 27 decliners and 3 flats

  • As the Russell 2000 slid more than 1%.  

Metrics:  Tuesdays, the IBB was down -0.57% and the XBI was down -0.84% while the VIX was up +2.55 points or +15.24% at 19.28

 

Monday: The Dow closed UP +17.15 points or +0.04%, the S&P closed UP +24.31 points or +0.42% while the Nasdaq closed UP +69.58 points or +0.38%

  • Wrapping-up the final trading session of what is shaping up to be a questionable pricing month and quarter.               
  • Markets had a rough start to what is historically the weakest month for the stock market, but rebounded as the Fed cut interest rates by a supersized half point.
  • For the month, the Dow advanced +1.9%, Nasdaq gained +2.7%, while the S&P 500 added 2%.

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 …

  • Markets had a rough start to what is historically the weakest month for the stock market, but rebounded as the Federal Reserve cut interest rates by a supersized half point.

Monday’s advance/decline line at the open was positive with 25 incliners, 7 decliners and 3 flats; ending with a negative close at the close of 14 incliner, 18 decliners and 3 flats

  • The cell and gene therapy sector screamed having no ice cream   as pricing power went out

Metrics:  Mondays, the IBB was up +0.48% and the XBI was up +0.39% while the VIX was down -0.23 points or -1.36% at 16.73.

 

Tuesday’s Closing Down (10 of 27):

  • Blueprint Medicine (BPMC-$2.50),
  • Vericel (VCEL -$2.20 after Monday’s -$0.94),
  • CRISPR Therapeutics (CRSP -$1.40 after Monday’s -$0.34),
  • Intellia Therapeutics (NTLA -$1.35 after Monday’s -$0.45),
  • Beam Therapeutics (BEAM -$1.09 after Monday’s -$0.55),
  • Ionis Pharmaceuticals (IONS -$0.99 after Monday’s -$0.79),
  • LENZ Therapeutics (LENZ -$0.94 after Monday’s -$0.30),
  • BioLife Solutions (BLFS -$0.90 after Monday’s +$0.70),
  • Adverum Therapeutics (ADVM -$0.43 after Monday’s +$0.08),
  • Prime Medicine (PRME -$0.42 after Monday’s +$0.41),

Flat (3):

  • Bellicum Pharmaceuticals (BLCM)
  • Homology Medicine (FIXX)
  • Voyager Therapeutics (VYGR)

Tuesday’s Closing Up (5 of 5):

  • Alnylam Pharmaceuticals (ALNY +$1.03 after Monday’s +$0.12),
  • Ultragenyx Pharmaceuticals (RARE +$0.96 after Monday’s +$1.12),
  • AxoGen (AXGN +$0.29 after Monday’s +$0.23),
  • Mesoblast (MESO +$0.10 after Monday’s +$0.57),
  • Compass Therapeutics (CMPX +$0.06),

 

RegMed Investors’ (RMi) pre-open: I didn’t post as I felt the market and sector would be de-stabilized by middle East tensions and as Hurricane Helene damage intensifies

 

Ebb and flow of MY covered sector cell and gene therapy session daily “endings”:  Q4/24

  • 1st session closes negative

Q3/24

  • September – 10 positive and 11 negative closes
  • August: 1 neutral, 10 positive and 11 negative closes
  • July: 1 market holiday. 1 day off, 6 negative, 1 neutral and 12 positive closes

 

The BOTTOM LINE: October is upon us … and volatility as expected …

I kept writing about uncertainty and skepticism …

 

Markets dived escalating volatility:

  • US stocks slid on Tuesday after Iran fired over 181 ballistic missiles at Israel, pushing oil prices for West Texas Intermediate and Brent to their biggest increases in nearly a year.
  • Job openings surprisingly increased in August, furthering the narrative that while the labor market is cooling, it's not rapidly slowing.
  • US manufacturing (data) held steady in September.
  • A strike by dockworkers began on the East and Gulf coasts, threatening to halt the flow of half the US's ocean shipping.
  • Some estimates project that a port strike could cost the US $5 billion per day. The last port strike was in 1977 and lasted for 45 days.
  • Hurricane Helene damage and deaths grow through-out many southern states.
  • The White Houses response with the upcoming election also will explain some of the mixed signals coming toward the market

 

The month of September in review …

  • Q3 ended … the 5th week of 1 day closed … NEGATIVE.
  • The 4th week of September’s Friday and Thursday popped to a positive close after Wednesday closed negative; Tuesday closed positive after Monday closed negative …
  • The 3rd week of September’s as Friday bombed the sector after Thursday’s sector ascended to new heights after Wednesday declined after Tuesday ascended helped by “uncle algo and his electronic trading dwarfs” after Monday, bolted to the downside …
  • The 2nd week’s Friday rapid positive ascension followed Thursday’s positive after Wednesday’s sector gained altitude post Tuesday’s negative drop in the puddle after Monday’s closed positive
  • Following the 1st short week of September ending with 4 negative closes - a bust!

 

The top three (3) performing in the session: 

  • Tuesday: Ultragenyx Pharmaceuticals (RARE), Alnylam Pharmaceuticals (ALNY) and AxoGen (AXGN)
  • Monday: BioLife Solutions (BLFS), Mesoblast (MESO) and Ultragenyx Pharmaceuticals (RARE)

The worst three (3) in the session: 

  • Tuesday: Blueprint Medicine (BPMC), Vericel (VCEL) and Intellia Therapeutics (NTLA)
  • Monday: Vericel (VCEL), Ionis Pharmaceuticals (IONS) and BEAM Therapeutics (BEAM)

 

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.