November 7, 2023 4:43pm

Add in “uncle algo and his electronic dwarfs” contributions that will last how long?

Pre-open Indications: 2 Hits < Beam Therapeutics (BEAM +$1.69), Caribou Biosciences (CRBU $0.00)> 0 Miss

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I also won’t apologize for being a “Devil’s Advocate” challenging views or consensus by building a better or possible case for an explanation of today’s actions

The Dow closed UP +56.74 points or +0.17%, the S&P closed UP +12.40 points or +0.28% while the Nasdaq closed UP +121.08 points or +0.90%

Q3 earnings’ reporting cycle is here to confirm whether or not any bottoms are even close to happening?

 

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 up on Tuesday for a seventh (7th) consecutive day for the first time since its eight-day win streak reached in November 2021.

 

RegMed/Stem/Cell and Gene Therapy’s 35 covered equities’ Advance/Decline (A/D) lines: what happened – differences …

  • Tuesday’s advance/decline line pre-open was positive with 21 incliners, 11 decliners and 3 flats; was positive at the mid-day with 23 incliners and 10 decliners and 2 flats at the mid-day, ending with a positive close of 23 incliners, 7 decliners and 5 flats

 

Ebb and flow:

Q4:  November – 4 positive and 1 negative closes

·         October – 12 negative and 10 positive closes

 

Key Metrics:

The iShares NASDAQ Biotechnology (IBB) and the SPDR S&P ETF (XBI) indicators:

  • Tuesday, the IBB was up +0.75% and the XBI was up +2.32%

The CBOE Volatility Index (VVIX: INDEX) tracked:

  • Tuesday was negative -0.02 point or -0.13% at 14.87

 

Closing Down (7 of 7):

  • Sage Therapeutics (SAGE -$0.98 after Monday’s -$0.68),
  • Cellectis SA (CLLS -$0.37),
  • MiMedx (MDXG -$0.20),
  • Fate Therapeutics (FATE -$0.20 after Monday’s +$0.12),
  • Adverum Biotechnologies (ADVM -$0.0452)
  • Sangamo Therapeutics (SGMO -$0.0216),
  • Mesoblast (MESO -$0.0050),

Flat (5):

  • Bellicum Pharmaceuticals (BLCM)
  • Caribou Biosciences (CRBU $0.00 after Monday’s +$0.59),
  • Compass Therapeutics (CMPX)
  • Graphite Bio (GRPH)
  • Harvard Apparatus RN (HRGN) 

Closing Up (10 of 23):

  • CRISPR Therapeutics (CRSP +$7.00 after Monday’s +$0.59),
  • Verve Therapeutics (VERV +$3.72 after Monday’s -$0.60),
  • Alnylam Pharmaceuticals (ALNY +$3.05),
  • Blueprint Medicine (BPMC +$1.89 after Monday’s -$1.04),
  • Intellia Therapeutics (NTLA +$1.83 after Monday’s -$1.10),
  • Beam Therapeutics (BEAM +$1.69 after Monday’s -$1.19),
  • AxoGen (AXGN +$1.45),
  • Ionis Pharmaceuticals IONS +$1.42 after Monday’s -$0.90),
  • uniQure NV (QURE +$0.78),
  • Regenxbio (RGNX +$0.65 after Monday’s +$0.46),

 

Q4/23 – November

  • Tuesday closed positive with 23 incliners, 7 decliners and 5 flats

 

The BOTTOM LINE: Is the cell and gene therapy sector, a glass half full or half empty … as “our” universe reclaimed positive territory Tuesday?

  • I think the sector is responding today to lower yields as investor decisions are questioning whether there is going to be a meaningful recession or not.
  • Attention is STILL about the viability of earnings season …
  • Volume on the Nasdaq dipped compared with the same time on Monday.
  • There isn’t much on the calendar for investors to parse through this week, aside from a slate of appearances from Fed officials.
  • Fed Bank of Minneapolis President Neel Kashkari seemed to spook markets with hawkish comments in recent interviews. <Barron’s>

 

"There was quite a bit of euphoria at the end of last week on the belief that the Fed is done, the jobs market is slowing, that the U.S. economy is going to experience a soft landing. People have started to become a bit more clear-eyed. There is the risk that the Fed could rise again." < Michael Hewson, chief market analyst at CMC Markets UK>

 

Roiling markets:

  • Short positioning and leveraged trading in hedge funds percentage (%) is the highest since November 2018 …
  • Regulators are particularly concerned about one strategy called the basis trade, which involves using leverage to profit from the price gap between Treasury futures and the underlying cash market. It has garnered particular attention from federal watchdogs over concerns about a lack of visibility into the amount of risk in the market.
  • Reiterating, more earnings are coming around the bend
  • Up and down market and past cell and gene therapy activity is reflective of investors sentiment – we be happy as November starts but, does it continue this and next week?
  • Middle East conflict still weighed on the market as investors assessed the chances of it breaking out into a wider war. The rising geopolitical tensions in the Middle East could drive a global recession, leading investors have warned.
  • I STILL believe the political aspect of the U.S.’s polarization, and disparities of the debt ceilings and rate hike arguments are contributing to the roller coaster ride for share pricing actions.

What’s behind the numbers:

  • Market expectations are questionable …
  • The 10-year Treasury yield fell to 4.57%, continuing its march down from around 5% in October. The 10-year yield’s retreat has helped stocks bounce back.
  • The sector and overall stock market tends to consistently rise and fall over the short-term with alternating volatility and involuntary momentum contraction.
  • I remain EXTREMELY cautious as upcoming earnings may have a more significant negative impact on share price due to missed consensus as estimates will lessen valuations.

Welcome to my world of defining the “grey’ in our universe!

  • The Nasdaq was on track for its seventh (7th) straight session in the green.
  • I believe … there will be deceleration in sector pricing gains and economic activity for the remaining weeks of 2023.

The top three (3) performing in the session:

  • Tuesday: CRISPR Therapeutics CRSP) – 5x, Verve Therapeutics (VERV) and Alnylam Pharmaceuticals (ALNY)
  • Monday: CRISPR Therapeutics CRSP) – 4x, Verve Therapeutics (VERV) and Alnylam Pharmaceuticals (ALNY)

The worst three (3) in the session:

  • Tuesday: Sage Therapeutics (SAGE), Cellectis SA (CLLS) and MiMedx (MDXG) 
  • Monday: Beam Therapeutics (BEAM), Intellia Therapeutics (NTLA) and Blueprint Medicine (BPMC)

 

Right up front, “I also hate to be so negative or contrarian but, this is a NO spin zone and truth is its product; I can always be WRONG but … I am mostly EARLY!”

  • Focus continues to be on the quarterly earnings season!

 

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 its 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.