E Market Briefing For Thursday, August 13

Executive summary:

  • The S&P is on the threshold of an historic high and the broad list firms as well.
  • Most reactions to Biden tapping Kamala Harris are favorable.
  • Controversy swirls around a 'bear-raid' against Sorrento (SRNE), I'll focus on it, after a quiet day with media pundits mouths 'zipped', Sorrento counterattacks.
  • Federal Relief Talks remain 'in limbo', as Pelosi rebuffs Mnuchin, however the nation must have a deal emerge from this stalemate.

Strength-begets-strength - for the S&P, as now even the skeptics acknowledge it's highly probable (I thought today so maybe tomorrow) we 'eek-out' an historic high. In the past I've mentioned that I have never seen such a strong market with so many it seems 'up in arms' protesting the move, often the same ones advocating liquidating a lot back near the March capitulation lows.  

Now the continued negativity is gradually coming around to grasp what's occurred (a concentration in mostly big-cap technology names that were able to do the required heavy-lifting for the S&P and Nasdaq), which gradually broadens-out to include of course some stocks that benefit during the Covid-19 pandemic, or offer promise to. 

Hence there's less enthusiasm for the big major pharmas than before, but of course vaccines will be more for humanity than a profit-center for them, at least initially; then they'll make money on the annual vaccines (as it becomes combined with influenza vaccinations I presume, but that combo is probably a couple years away).  

Additionally there is realization that 2nd and 3rd generation vaccines and treatments are already somewhat understood (and combination 'cocktails) as being ideal ways to eventually wean-off dependence on ICU's, and move this more to a 'chronic' rather than 'acute' situation. That's how we get to 'live with' the virus, in a more complicated but not unprecedented way, given the history of Polio, Smallpox, roster viruses, and so on. It is the realization that there will be no 'single' winner in the fight for treatment or testing or cute, that had us suggest (for those brave enough to enter what a wise older member described as) entering a 'minefield of Covid stocks'.  

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William K. 2 months ago Member's comment

The times are certainly changing, and not for the better. The very unfortunate thing about peaks is that they are surrounded by valleys. That fact has been clear through all of history.