November 28, 2023 4:49pm

Markets move sideways after conflicting remarks from Fed officials as cell and gene therapy sector bumped against resistance closing neutral

Late Breaking News: Verve Therapeutics (VERV drops -$1.03 in aftermarket to $10.90) has commenced an underwritten public offering of shares.

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After careful examination of the sector and breathe trends, I STILL come away more cautious. Having lived through the rise and multiple declines of “our” universe’s stock price.

We're in a period of sector rotation, and people are trying to figure out what cell and gene therapy sector equities at are going to continue to do well and what are the stocks that are going to suffer.

Investors must be better informed on what fluctuating economics and markets can do to an equity, or what impact indications or expectations can have.

 

The Dow closed UP +83.51 points or +0.24%, the S&P closed UP +4.46 points or +0.10% while the Nasdaq closed UP +40.73 points or +0.29%

 

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 rose Tuesday, resuming their November rally, as comments from a Fed official raised conflicting “stories” about raise interest rates.

Economic Data Docket: Home prices were 3.9% higher in September compared with the same month a year earlier, according to the S&P CoreLogic Case-Shiller Index. The growth coincided with the 30-year fixed mortgage rates’ climb toward 8%.  Rents are easing, while home prices rise.

  • Year-to-date, home prices nationally have risen 6.1%, much more than the median full calendar year increase in more than 35 years of this index’s data.

 

News (continued): VERV’s proposed public offering are being offered by Jefferies, Guggenheim Securities, William Blair, BMO Capital Markets, and RBC Capital Markets are acting as joint book-running managers for the public offering.

 

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

Tuesday’s advance/decline line was negative with 11 incliners, 22 decliners and 2 flats at the open, the mid-day continued negative with 11 inclined, 24 decliners and 0 flat, ending with a neutral close of 17 incliners, 17 decliners and 1 flat

 

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

Q4:  November – 10 positive, 1 neutral and 8 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 down -0.30% and the XBI was down -0.19%

The CBOE Volatility Index (VVIX: INDEX) tracked:

  • Tuesday was down -0.07 point or -0.55% at 12.62

 

Monday’s Closing Down (10 of 17):

  • Ionis Pharmaceuticals (IONS -$1.36),
  • Vericel (VCEL -$1.04 after Monday’s +$0.34),
  • CRISPR Therapeutics (CRSP -$0.95 after Monday’s +$1.64),
  • Blueprint Medicine (BPMC -$0.75 after Monday’s +$0.67),
  • BioLife Solutions (BLFS -$0.69 after Monday’s -$0.64),
  • Solid Biosciences (SLDB -$0.26 after Monday’s +$0.30),
  • Ultragenyx Pharmaceuticals (RARE -$0.15 after Monday’s -$0.53),
  • Generation Bio (GBIO -$0.10),
  • uniQure NV (QURE -$0.04 after Monday’s +$0.14),

Flat (1):

  • bluebird bio (BLUE)

Monday’s Closing Up (10 of 17):

  • Alnylam Pharmaceuticals (ALNY +$2.17 after Monday’s -$3.72),
  • Beam Therapeutics (BEAM +$0.61 after Monday’s -$0.51),
  • Verve therapeutics (VERV +$0.37 after Monday’s -$0.56),
  • Cellectis SA (CLLS +$0.33),
  • Fate Therapeutics (FATE +$0.25),
  • AxoGen (AXGN +$0.24 after Monday’s +$0.03),
  • Sage Therapeutics (SAGE +$0.16 after Monday’s -$0.39),
  • Intellia Therapeutics (NTLA +$0.10 after Monday’s -$0.38),
  • Editas Medicine (EDIT +$0.09 after Monday’s +$0.07),
  • Caribou BioSciences (CRBU +$0.08 after Monday’s +$0.09)

 

Q4/23 – November

  • Tuesday closed neutral with 17 incliners, 17 decliners and 1 flat

 

The BOTTOM LINE: With the end of November in sight, investors are weighing whether to punch out some sector equities or buy up some bottom liners.

  • There's a noticeable that the economy is slowing, effecting share price growth that continue to fall and jockey for appreciation, as LPS (loss-per-share) cell and gene therapy companies’ earnings and “runways” highlighted the NEED to FINANCE with NO current outlook from capital markets and if they do finance the” raises” will be diminished without spectacular clinical results or partner “intervention.”  
  • As I wrote Friday (published Saturday a.m.) substantiated by Monday and Tuesday’s close: “While many cell and gene therapy sector upsiders are UP, I believe … also extended; it’s usually a signal to lighten the load of the sector’s upside movers. I have concerns over the resiliency of upside moves that usually end in downward sells as the risk/reward profile doesn’t always compel elevated and “dramatic” i.e., sudden equity pricing.
  • Traders are still going to take profits on uncertain days as we get toward the end of the year," Carlson added. "But there's a pretty long list of reasons why this market has the potential to continue to move higher." <Reuters>
  • Board Governor Christopher Waller hinted at lower interest rates in the months ahead if inflation continued to ease, while Chicago Fed President Austan Goolsbee said he believed overall inflation was coming down at a pace not seen since the 1950s.
  • Versus … Governor Michelle Bowman suggested another rake hike could be necessary to rein in inflation in a timely manner versus other “Fed heads.”

 

What’s behind the numbers:

  • Bracing for key inflation and jobs data later in the week.
  • U.S. Treasury yields dipped with benchmark 10-year notes were down 3.8 basis points to 4.350%, from 4.388% late on Monday.
  • Consumer confidence improved in November, even as most still expect a recession ahead. The Conference Board’s index rose to 102 for the month, higher than a downwardly revised 99.1 from October and ahead of the estimate for 101.

 

Interesting Stat: The biotech sector accounted for $580 million in investment across six deals in Q2/23.

 

It's time to think ahead to December. It's usually an important month for the Nasdaq.

  • Don’t FORGET portfolio tax selling and a bit of rebalancing
  • Reiterating, “Investors NEED to start formulating their portfolio outlook into next year.”
  • And then comes January and with worries that the U.S. economy will be slowing down, the potential for continued Middle East violence and, of course, the real prospect of bitterly contested elections across all of the United States. <The Street>

The top three (3) performing in the session:

  • Tuesday: Alnylam Pharmaceuticals (ALNY), Beam Therapeutics (BEAM) and Verve Therapeutics (VERV)
  • Monday: CRISPR Therapeutics (CRSP), Blueprint Medicine (BPMC) and Vericel (VCEL)

The worst three (3) in the session:

  • Tuesday: Ionis Pharmaceuticals (IONS), Vericel (VCEL) and CRISPR Therapeutics (CRSP),
  • Monday: Alnylam Pharmaceuticals (ALNY), BioLife Solutions (BLFS) 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 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.