Sideways Market Vexes Traders: Biotech Stocks Are Fading

Sideways Market with Few Catalysts Ahead: Healthcare (XLV) and Biotech Rally Fades

China Trade Deal Already Priced into the Market?

Macro Policy Issues are back into the News as US Deficit Hits Record High

The 2019 rally is fading with few clues as to what comes next. The narrative gets more complicated once a slower global economic outlook gets factored into the fundamentals. A trade deal with China is certainly needed as the market expects it. The major indices (SPY) show a sideways market with a downward bias. However the healthcare sector (XLV) took a major hit yesterday and weakness continued today down to $90.39 off Monday’s high of $93.26. Major biotech ETFs are weak today: FBT down 2.55%, IBB down 2.79%, XBI down 3.59%. Some pundits attributed the biotech losses to the resignation of FDA Commissioner Scott Gottlieb but it is hard to connect that news because of the breadth of selling today and general concerns about drug costs and recent Congressional hearings. Market action in biotech has been choppy over the past five days with weak momentum interrupted by a “head fake” rally on Friday attributed to excitement about gene therapy and dealmaking. But after a 20%+ move YTD catalyzed by major acquisitions it may be time for a rest. Just this week Biogen (BIIB) bought a small player in gene therapy Nightstar Therapeutics (NITE) for $877M. Nightstar is a clinical stage gene therapy Company developing treatments for rare inherited retinal diseases.

Here are many gene therapy companies* to track including stocks mentioned in this week’s Barron’s article, “Why Big Pharma is Diving into Gene Therapy”:

From Barron’s          
Company Symbol Price 5 Day %
Mkt Cap
    3/6/19 Perf* $B  
Audentes Therap BOLD 32.26   1.377  
MetraGTx MGTX 18.03   0.494  
RegenexBio RGNX 53.49   1.92  
Solid Biosci SLDB 9.89   0.35  
uniQure QURE 56.52   2.1  
Voyager Therap VYGR 16.82   0.548  
Diversified Plays          
Biomarin BMRN 91.05   16.23  
Sarepta SRPT 132.25   9.325  
Amicus FOLD 13.08   2.85  
bluebird bio BLUE 144.5   7.94  
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David Teitelman 1 year ago Member's comment

Trump feels sorry for Manafort, who committed fraud for 30 years. Why? Trump doesn't think he did wrong! He's suppose to be a moral compass to both country & globally... because it affects policy, diplomacy & business!