December 18, 2024 4:46pm

Sparking a spiral whirlwind of cell and gene therapy sector share pricing as “market performance on Fed days has been weakest during Powell’s tenure as chair, as compared to the 3 other Fed chairs coming before him” <BIG>

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!  

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

Invest like you're driving on an icy, windy road, not an open highway.

 

Wednesday: The Dow closed DOWN -1123.03 points or -2.58%, the S&P closed DOWN -178.45 points or -2.95% while the Nasdaq closed DOWN -716.37 points or -3.56%

  • The sank deeper into the history books with the storied index on track for its 10th straight losing day following a disappointing rate outlook by the Fed.

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 central bank reduced its overnight borrowing rate by 25 basis points to a target range of 4.25% to 4.5%, as expected.
  • Building permits rose in November even as both housing starts and completions declined
  • Mortgage rates moved markedly higher last week, causing overall mortgage demand to drop

Wednesday’s advance/decline line at the open was negative with 13 incliners, 20 declined and 2 flats; ending with a barely negative close at the close of 2 incliner, 32 decliners and 1 flat

  • Sector closed deeper after a barely deep

Metrics:  Wednesday, the IBB was down -5.34%, the XBI was down -4.66 while the VIX was up +11.76 points or +73.90% at 27.92

 

Tuesday: The Dow closed DOWN -267.58 points or -0.61%, the S&P closed DOWN -23.47 points or -0.39% while the Nasdaq closed DOWN -64.83 points or -0.32%

  • The Dow entered the history books Tuesday with its 1st 9-day losing streak since the 1970s in sight.            

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

  • November’s retail sales figure came in better than economists expected …
  • Retail sales rose a seasonally adjusted 0.7% for the month, an acceleration from the upwardly revised 0.5% in October and better than the estimate for 0.5%. Excluding autos, sales increased 0.2%, a touch below the 0.3% estimate. The numbers are not adjusted for inflation, so the spending pace was ahead of the 0.3% increase in the consumer price index. A 2.6% increase in motor vehicle and parts sales paced the spending, while online shopping rose 1.8%. Miscellaneous sales tumbled 3.5%. On a 12-month basis, receipts were up 3.8%, ahead of the 2.7% CPI inflation rate.
  • The National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index stayed at 46 in December, lower than economists’ estimates of 47. Any reading under 50 indicates more builders view conditions as poor rather than good.

Tuesday’s advance/decline line at the open was negative with 9 incliners, 23 declined and 3 flats; ending with a barely positive close at the close of 17 incliner, 16 decliners and 2 flats

  • Sector closed up as pitching mechanics overcome batting stances

Metrics:  Tuesday, the IBB was UP +0.64 %, the XBI was up +1.38 while the VIX was up +0.85 points or +6.23% at 14.67

 

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

Q4/24 – 3 positive and 10 negative closes

  • November – 1 holiday, 10 negative and 10 positive closes              
  • October: 8 positive and 15 negative sessions

 

Wednesday’s Closing Down (10 of 32):

  • Alnylam Pharmaceuticals (ALNY -$8.66 after Tuesday’s +$2.59 and Monday’s -$1.45),
  • Blueprint Medicine (BPMC -$4.70 after Tuesday’s +$1.09 and Monday’s +$2.20),
  • CRISPR Therapeutics (CRSP -$3.57 after Tuesday’s +$0.39 and Monday’s +$0.46),
  • Lenz Therapeutics (LENZ -$3.17 after Tuesday’s +$1.56 and Monday’s -$0.12),
  • Moderna (MRNA -$2.40 after Tuesday’s -$1.08),
  • Beam Therapeutics (BEAM -$2.13 after Tuesday’s +$0.35 and Monday’s +$1.00),
  • Ultragenyx Pharmaceuticals (RARE -$2.01 after Tuesday’s -$0.45 and Monday’s -$0.38),
  • BioLife Solutions (BLFS -$1.89 after Tuesday’s -$0.50 and Monday’s +$0.67),
  • Ionis Pharmaceuticals (IONS -$1.43 after Tuesday’s -$0.42 and Monday’s +$1.49),
  • Intellia Therapeutics (NTLA -$1.11 after Tuesday’s -$0.25 and Monday’s +$0.48),

Flat (1)

  • Homology Medicine (FIXX)

Wednesday’s Closing Up (2 of 2):

  • Brainstorm Cell Therapeutics (BCLI +$0.46 after Tuesday’s +$0.24),
  • Precigen (PGEN +$0.0225),

 

The BOTTOM LINE: All 3 of the market averages are selling off following the Fed's latest interest rate cut on Wednesday. Today’s negative close marks the 10th straight losing session for the Dow while the Nasdaq lagged the most, closing -3.56% lower.

  • As the Dow dived deep and then deeper on Wednesday.
  • While the small-cap benchmark Russell 2000 slipped 3% to its session low after the Fed signaled caution of future rate cuts. The benchmark is on track for its worst day since Sep. 3

 

I believe this market response is an … OVER-REACTION!!

The cell and gene therapy sector stocks kicked off the 3rd week of December, the final month of 2024 with ...

  • Monday positive close with a Tuesday barely positive close followed by a Wednesday’s deeply negative close
  • Last week, ends with 5 negative closes
  • Last week, Monday positive followed by Thursday and Wednesday, Tuesday’s negative closes and Friday positive close

 

A good quote; “Good-bye punch bowl. No Christmas cheer from the Fed. Policymakers see higher inflation and lower unemployment in 2024. There is simply no reason to be dovish given that outlook. “The easy lifting is done now that rates are no longer clearly restrictive. It’s a logical time to pause.” < David Russell, global head of market strategy at TradeStation>

 

December has been a traditionally a good month for stocks, yet I see the sector range-bound and taking some hits into the end of 2024.

  • Never forget, end of year tax selling
  • Portfolio managers are addressing rotations as year comes to years-end.
  • I keep writing about uncertainty and skepticism … and coming realities.
  • Even with the potential for some market hiccups along the way, the good news is Q4 has historically skewed positively, even after sector earnings kicked the bucket down the road!

Why do I keep repeating, so investors can make the connection …

The top three (3) performing in the session:    

  • Wednesday: Brainstorm Cell Therapeutics (BCLI) and Precigen (PGEN)
  • Tuesday: Alnylam Pharmaceuticals (ALNY), Lenz Therapeutics (LENZ) and bluebird bio (BLUE)
  • Monday: Blueprint Medicine (BPMC), uniQure NV (QURE) and Ionis Pharmaceuticals (IONS)
  • Friday: Mesoblast (MESO), Blueprint Medicine (BPMC) and Vericel (VCEL)

The worst three (3) in the session: 

  • Wednesday: Alnylam Pharmaceuticals (ALNY), Blueprint Medicine (BPMC) and CRISPR Therapeutics (CRSP)
  • Tuesday: uniQure NV (QURE), Ultragenyx Pharmaceuticals RARE) and Ionis Pharmaceuticals (IONS)
  • Monday: Alnylam Pharmaceuticals (ALNY), Vericel (VCEL) and Ultragenyx Pharmaceuticals RARE)
  • Friday: CRISPR Therapeutics (CRSP), bluebird bio (BLUE) and Ultragenyx Pharmaceuticals RARE)

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.