We are actually seeing something interesting in the sector where small caps are outperforming large caps (by a wide margin). Are investors finally starting to get more comfortable and increasing their risk? Could certainly be the case but it also is consistent with the short covering rally thesis. Just about all of the SMID biotech […]
March 2 Biotech Update
The market has a good rally off of the lows yesterday and despite still feeling concerned about the market it has actually had a nice rally in the second half of February. The problem is that two weeks of good price action is not nearly enough to get rid of the damage especially in the […]
February 29 Biotech Update
I would have expected more action to start the week but it has been pretty quiet. It looks like we are left to the sentiment tides once again as there is nothing I see on the news front that can make a dent in either direction. As such, I will spend today mainly talking about […]
February 26 Biotech Update
I was supposed to be back from travelling yesterday but the weather cancelled my flight but I am back at it today. Of course, I did not miss a lot of bullish action although there has been some SMID earnings that I want to touch on. We seem to be back in the pattern that […]
February 22 Biotech Update
It is a good start to the week as the markets open green and everything seems to be heading higher. One could argue that the trend of selling the rallies has broken but I still think we need to decisively put in a higher low and higher high before we can get any confidence in […]
February 19 Biotech Update
We are getting the pullback after that quick rip your face off rally and so now is the real moment of truth. Did the rally simply reset the relative strength to allow another leg lower or will buyers step in and buy this pullback? As I noted before there is no way of knowing and […]
February 18 Biotech Update
We continue to have a short covering rally as the most shorted stocks continue to outperform. This seems to be the mantra of people who want to discount the move but as I said before there is no reason to suspect that the bounce off the lows would be anything but a short covering rally. […]
February 17 Biotech Update
We are having a green opening after back to back green days, which is pretty rare this year. We have obviously been due for a bounce and whether this is the bottom or a dead cat bounce is yet to be determined. This move is driven by short covering (the most shorted stocks are greatly […]
February 12 Biotech Update
The market remains crazy and the sector is filled with odd moves. Yesterday seemed to be a good day of outperformance for the large caps and today they are red while the market is green. There were some good movers in SMID yesterday and today but not a real rhyme or reason for who outperforms […]
February 11 Biotech Update
The markets remain in turmoil despite a nice start (but poor finish) yesterday. Interestingly it seemed yesterday at least that large cap biotech outperformed the broader market. Obviously it could very easily be an oversold bounce but in a world of limited earnings growth, one could make the case that some of the large cap […]
February 10 Biotech Update
I am glad I was out of the office for the start of the week as the market took a drubbing. While today is certainly starting off better, this is still not a healthy market. I want to spend some time talking macro and then broadly about biotech and end with some specific company news. […]
February 5 Biotech Update
The sector did OK during the pricing hearing but it was more of a mixed bag than across the board out- or under-performance. Today everything is down, so it is hard to see if there is any other effect from the hearing or the debate last night. We are still in a macro driven market […]
February 4 Biotech Update
Today is going to be an interesting day. Yes, there is the drug pricing testimony in Congress and that is simply a show and grandstanding that has no impact on the actual chances of changing policy. It will be good theater (unless you are already tired of seeing the same stories recycled everyday) but in […]
February 3 Biotech Update
The market remains tied to oil and while sentiment remains negative on oil it still has not made a new low. This is not to say that a new low is not coming but as long as it does not make a lower low, it is at least some positive for the market. Ultimately, we […]
February 1 Biotech Update
Different week but the same market. There remains a bias to the downside, although perhaps an optimist can see a slight outperformance of the sector. At the very least, it seems like the sector is not leading the market lower. We got some news this morning but the key this week will continue to be […]
January 29 Biotech Update
It was obviously another bad day for the sector. The technicals look broken. The headlines are all about pricing. Buyers are on strike. There are no real exciting near term catalyst. Despite all of the negatives, there is some reason for hope at least over the medium term. 1. ISI had an impromptu call yesterday […]
January 28 Biotech Update
The market and sector did not like the FOMC decision or perhaps the wording of the decision. The sector remains in a precarious position. It has already fallen a lot but it remains at critical long term trend lines and if they break we could only be halfway through the decline. There was some talk […]
January 27 Biotech Update
The sector finally caught a break with the macro headwinds seeming to pause only to get sector specific headwinds with Donald Trump talking about drug pricing. It was not clear exactly what he meant as the numbers he threw around for the savings from Medicaid were more than the Medicaid yearly drug expense (keeping in […]
January 25 Biotech Update
It is a mixed start to the week but at least we have some biotech news to talk about even if it is not exactly what was expected. That being said I still think we are in a macro driven market and it will be hard for any sector to avoid the headwinds (or tailwinds) […]
January 22 Biotech Update
The market seems to be catching its footing but again if we are bottoming we are in the early stages and confirmation still needs to happen but I am cautiously optimistic that the selling pressure has eased (not really a brave statement to make this morning but given the start to the year you never […]
