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COVID Concerns & Yearend Apathy Trim Markets Again On Monday – $FATE $CERN $INVO $NBSE $XSPA $XBI Rise!

By John F. Heerdink, Jr.
“Friendship marks a life even more deeply than love. Love risks degenerating into obsession, friendship is never anything but sharing.”  – Elie Wiesel, American Novelist, September 30, 1928 – July 2, 2016
 
 
The stock market took another broad based hair cut today. Overly reported COVID cases continued to rise in the US and around the world brewing concerns and worries about growth. The highly transmissible Omicron variant is now reportedly the dominant strain in the USA representing 73% of cases and is causing heart burn with investors. When you combine these COVID concerns along with ongoing tax selling and overall holiday/vacation/yearend apathy & increased uncertainty around Biden’s Build Back Better Act (thanks to Senator Joe Manchin’s Sunday declaration) , it is not adding up to a broadly liquid & healthy market currently. 9 of the 11 sectors finished the day in the red with only the utilities and the consumer staples sectors managing to barely surface their heads above water closing up +.1% and +.04% respectively. With growth concerns, oil prices pulled back to close below $70 closing at $68.66/bbl, -3.2% on the day. The yield curve steepened where the 2-yr yield moved down 2 basis points to .62% & the 10-yr yield moved up 2 basis points to 1.42%. The macroeconomic schedule also produced the Conference Board’s Leading Economic Index (LEI) that confirmed a 1.1% rise in November. The U.S. Dollar Index moved lower by .1% to 96.51, gold prices dropped $7 to close at $1,792/oz., silver closed at $22.26, -$.11, & Bitcoin (BTC) closed at $46,965.75, +.6%.
 
In turn, the major indices closed lower as follows: the S&P 500 closed at 4,568.02 (-1.14%), the Dow 30 closed at 34,932.16 (-1.23%), & the Nasdaq closed at 14,980.94 (-1.24%). The small caps on the Russell also closed lower at 2,139.87 (-1.57%), while the micro caps moved lower in virtual lock step as the iShares Micro-Cap ETF (IWC) closed at $134.15, -1.27% as bids were hard to come by generally the smaller you were today.
 
On the bright side of things, the SPDR S&P Biotech ETF (XBI), a barometer of the smaller biotech stocks, closed in positive territory at $115.79, +.16% as it has swung from a new 52-wk low established Monday of $106.88. The 52-wk range is $106.88 – $174.79.
 
Could we see a nice swing to the positive over tomorrow after the continued sell off today? Possibly… Currently the futures have turned positive, but I would suggest that their will be ample time and opportunity to pounce on valued issues selectively as volatility is here to stay this week with a number macroeconomic reports to hit and at least until year’s end!
 
 
 
 
VP WATCHLIST
 
Apple (AAPL) closed at $169.75, -.81% & Tesla (TSLA) closed at $899.94, -3.50%. By the way, Tesla’s CEO Elon Musk is stating that he will pay $11B in taxes this year. Ford closed at $19.42, -1.77%. Last week, Ford Pro™ announced the launch of Ford Pro Charging, a comprehensive solution for commercial electric vehicle charging. While more commercial customers want to switch to electric vehicles to reduce maintenance costs, minimize emissions and drive down total cost of ownership*, the transition from all internal combustion-powered fleets can be complex. Ford Pro Charging will help ease this transition by delivering intuitive software and commercial hardware infrastructure to support charging and energy management.   The Walt Disney Company (DIS) closed at $146.47, -1.54% and is valued at $273.376B. Disney will hold its annual meeting of shareholders on Wednesday, March 9, 2022 at 1:00 p.m. ET / 10:00 a.m. PT by virtual meeting and will be made available via webcast at www.disney.com/investors.
 
On the small side, Atossa Therapeutics (ATOS), a clinical-stage biopharmaceutical company seeking to develop innovative proprietary medicines in oncology and infectious disease with a current focus on breast cancer and COVID-19, rose to an intraday high of $1.93 prior to closing at $1.87, -5.08% on 2.215M shares of trading volume. Physician-Scientist and CEO of Atossa, Steven Quay, MD, PhD, recently published an e-print on his research into a new coronavirus, named BANAL-236, reported by the Institut Pasteur in September 2021. At the time, BANAL-236 was the first bat coronavirus with high homology to SARS-CoV-2 that could directly infect human cells using the same receptor that SARS-CoV-2 uses. The new research reports that BANAL-236 has evolved the ability to infect human cells by an unknown mechanism that violates over 40 years of coronavirus research. The COVID-19 e-print is available here and has also been submitted to Nature. “When I read the paper from the Institut Pasteur and looked at the virus, I immediately assumed there was an error in either the way the sequence was assembled or a mix up in the lab with another virus to explain the infectivity,” Quay said. “I contacted the Institut Pasteur with my findings and was deeply disturbed to learn that there was not, in fact, some simple mistake had occurred to explain things. I now knew we were in uncharted waters with a virus that is missing eight key elements that have been shown, over 40 years of research, to be required for growth.” Atossa management also recently presented at  “A Town Hall Q&A Event With Atossa Therapeutics Management Team” with Tribe Public. You can view it clicking here. Atossa also announced recently that it had completed a pre-investigational new drug (PIND) meeting with the FDA to obtain input from the FDA on pre-clinical, clinical, manufacturing and regulatory matters in the U.S. for Atossa’s proprietary Z-endoxifen to treat breast cancer in the neoadjuvant (prior to surgery) setting.
 
On Monday, Fate Therapeutics, Inc. (NASDAQ: FATE), a clinical-stage biopharmaceutical company dedicated to the development of programmed cellular immunotherapies for patients with cancer, showcased positive interim Phase 1 data from the Company’s FT596 program for patients with relapsed / refractory B-cell lymphoma (BCL) at the 63rd American Society of Hematology (ASH) Annual Meeting and Exposition. FT596 is the Company’s off-the-shelf, multi-antigen targeted, iPSC-derived natural killer (NK) cell product candidate derived from a clonal master induced pluripotent stem cell (iPSC) line engineered with three anti-tumor functional modalities: a proprietary chimeric antigen receptor (CAR) optimized for NK cell biology that targets B-cell antigen CD19; a novel high-affinity, non-cleavable CD16 (hnCD16) Fc receptor that has been modified to prevent its down-regulation and to enhance its binding to tumor-targeting antibodies; and an IL-15 receptor fusion (IL-15RF) that augments NK cell activity. “The interim dose-escalation clinical data from our FT596 program in relapsed / refractory B-cell lymphoma demonstrate that off-the-shelf, iPSC-derived CAR NK cells can bring substantial therapeutic benefit to heavily pre-treated patients in urgent need of therapy, with high response rates and meaningful duration of responses,” said Scott Wolchko, President and Chief Executive Officer of Fate Therapeutics. “We are particularly pleased with the therapeutic profile that has emerged with FT596 in combination with rituximab, where over half of the patients treated with a single dose of FT596 at higher dose levels achieved a complete response with a favorable safety profile that is clearly differentiated from CAR T-cell therapy. We look forward to assessing a two-dose treatment schedule for FT596 to further define its potential best-in-class therapeutic profile and ability to reach more patients, including those earlier in care.” Shares of FATE closed at $51.63, -5.56%. 
 
InMed Pharmaceuticals Inc. (NASDAQ: INM), a leader in the development, manufacturing and commercialization of rare cannabinoids, closed at $1.41, -3.09% after hitting an intraday high of $1.44. Today InMed announced that a peer-reviewed scientific article entitled “Cannabinol Modulates Neuroprotection and Intraocular Pressure: A Potential Multi-Target Therapeutic Intervention for Glaucoma”, has been published in Biochimica et Biophysical Acta (BBA – Molecular Basis of Disease), a leading international journal focused on biochemistry and molecular genetics of disease processes and models of human disease in the area of aging, cancer, metabolic-, neurological-, and immunological-based diseases. The peer-reviewed article highlights research evaluating the use of cannabinol, or CBN, as a potential treatment option for glaucoma. Several studies were conducted to evaluate the survival of retinal ganglion cells, modulation of intraocular pressure and its effects on extracellular matrix proteins using in vitro and in vivo glaucoma models. These studies resulted in two key findings: first, CBN may promote neuroprotection of cells in the retina that are responsible for vision; and second, CBN may normalize intraocular pressure by attenuating changes in the extracellular matrix proteins. The article also reports on the comparison of CBN with other cannabinoids, including cannabidiol (CBD) and tetrahydrocannabinol (THC), with results indicating that CBN has a stronger effect and broader neuroprotective therapeutic range. These observations elucidate the therapeutic potential for CBN in the treatment of glaucoma.
 
INmune Bio, Inc. (NASDAQ: INMB), a clinical-stage immunology company focused on developing treatments that harness the patient’s innate immune system to fight disease, recently presented data at the San Antonio Breast Cancer Symposium showing mucin 4 (MUC4) expression predicts worse survival and is a treatment resistance factor in women with triple negative breast cancer (TNBC). INB03, a DN-TNF therapy, can reverse TNBC treatment resistance by decreasing expression of MUC4 and reducing immunosuppression in the tumor microenvironment (TME) by increasing anti-tumor macrophage phagocytosis and increasing lymphocyte function in the TME. The poster will be presented by Dr. Roxana Schillaci, Instituto de Biología y Medicina Experimental, Buenos Aires, on December 10th. RJ. Tesi, M.D, Chief Executive Officer of INmune Bio, commented, “We are excited to have Dr. Schillaci present these data that expand on her previous findings on the role of MUC4 expression which predicts worse survival and resistance to therapy in HER2+ breast cancer therapy. Now, in both TNBC and HER2+ breast cancer, MUC4 predicts resistance to immunotherapy and an immunosuppressive TME that can be overcome with INB03.” Treatment with INB03 in murine models of breast cancer improves macrophage anti-tumor phagocytic activity, lymphocyte infiltration and function suggesting improved response to combination therapies of INB03 with inmunotherapy. Shares of INMB closed trading today at $1o.66, -1.30%. 
 
Shares of INVO Bioscience, Inc. (NASDAQ: INVO), a medical device company focused on commercializing the world’s only in vivo culture system (IVC), INVOcell®, closed at $3.90, +1.3% after hitting an intraday high of $3.9873, but well off of its 52-wk high of $12.30. A sell side analyst at Colliers Securities recently published a Buy Rating with a $6 Price Target recently. Last week, INVO Bioscience, Inc. announced that it has entered into an expanded agreement with Ovoclinic, a group of clinics specialized in assisted reproductive treatments with four locations across Spain (Madrid, Marbella, Málaga, Ceuta) and collaborating centers around Europe, to accelerate adoption of INVOcell within their markets. The agreement includes the expanded adoption of INVOcell within Ovoclinic locations as well as establishing an INVO Center of Excellence for future training for the European Market. Cristina Gonzalez, embryologist and Quality Manager of Ovoclinic laboratories stated, “After several successful trials implementing the exciting INVOcell fertility treatment, Ovoclinic aims to provide its patients with this effective alternative to the processes used so far in Spain in the field of reproductive medicine. We consider INVOcell to be an effective method of natural reproduction that involves the future mother at the very first moment of the process. We are confident that this innovative treatment will help many patients to choose this new alternative solution to achieve their dream of forming a family by actively participating in the reproductive process.” According to the World Bank, Spain, with total population of approximately 47 million people, has one of the lowest fertility rates in Europe, affecting approximately 15% of the population, or one in seven couples of reproductive ages. According to reports, in 2010, there were approximately one million couples requesting assisted reproductive treatment, however only 22% received one or more assisted reproductive treatment cycles. The average waiting time for an IUI or IVF cycle in a public health facility was 339 days. Ovoclinic reports that they maintain the best technical and human resources to deal with all kinds of infertility problems along with the simplest and most natural treatments to the most complex and advanced techniques pioneered in Spain. Ovoclinic also works in partnership with Ovobank, the first European Donor Egg Bank in Europe.
 
Shares of NeuBase Therapeutics (NASDAQ: NBSE) a biotechnology platform company Drugging the Genome™ to address disease at the base level using a new class of precision genetic medicines, closed  at $2.84, +1.43%, and has rose to $3 in the aftermarkets. Dietrich A. Stephan, Ph.D., Chief Executive Officer of NeuBase, presented in person at the Jefferies London Healthcare Conference recently.
 

FURTHER AFIELD

Larry Ellison’s Oracle (ORCL, $91.64, -5.15%) confirmed a $28.3B or $95/share purchase of the medical software group Cerner (CERN, $90.49, +.80%), the second largest designer of software for doctors and hospitals. This is the largest buyout in Oracle’s history!

South San Francisco-based Senti Biosciences, Inc., a leading Gene Circuit company, and Dynamics Special Purpose Corp. (Nasdaq: DYNS, $9.88, -1.59%), a special purpose acquisition company (SPAC) led by Omid Farokhzad, MD, Executive Chair of the Board of Directors, and Mostafa Ronaghi, PhD, Chief Executive Officer, today announced they have entered into a definitive business combination agreement to create a public company focused on Gene Circuit-engineered cell and gene therapies. Upon closing of the transaction, the combined company will be named Senti Biosciences, Inc and will be led by Tim Lu, MD, PhD, Chief Executive Officer and Co-Founder of Senti Bio. The Company plans to list its common stock on the Nasdaq Capital Market. Dr. Farokhzad, who is currently serving as CEO and Chair of Seer, and David Epstein, Dynamics board member and former CEO of Novartis Pharmaceuticals, will be joining the Senti Bio Board of Directors upon closing of the transaction. Business combination with Dynamics Special Purpose Corp. (Nasdaq: DYNS) is expected to provide more than $296 million in gross proceeds, over $153 million of which is fully committed in a common stock Private Investment in Public Equity (“PIPE”) financing and from non-redemption agreements. Over $86 million in non-redemption agreements committed from existing Dynamics investors including funds managed by ARK Investment Management LLC, funds and accounts managed by Counterpoint Global (Morgan Stanley Investment Management), Invus, and T. Rowe Price funds. Over $66 million in a PIPE financing committed from institutional investors including 8VC, Amgen Ventures, funds and accounts managed by Counterpoint Global (Morgan Stanley Investment Management), Invus, LifeForce Capital, NEA, Parker Institute for Cancer Immunotherapy, and T. Rowe Price funds. 

Rocket Companies, (NYSE: RKT, $14.46, -6.29%) the Detroit-based platform company consisting of tech-driven real estate, mortgage and financial services businesses – including Rocket Mortgage, Rocket Homes and Rocket Auto – today announced it has entered into an agreement to acquire Truebill, the leading personal finance app that helps consumers manage every aspect of their financial lives, for $1.275B in cash. Reportedly, it is believe that this acquisition brings millions of clients to the Rocket platform and is expected to add $100 million in annual recurring revenue to Rocket’s $1.3 billion of annualized servicing fee income.

Ginkgo Bioworks (NYSE: DNA, $11.06, -.98%) recently confirmed that it has collected, identified, and sequenced three samples containing the novel BA.3 sublineage of the Omicron variant. Samples came from passengers on flights originating from South Africa who arrived at Newark Liberty International Airport (EWR) in early December. These samples were collected in collaboration with the Centers for Disease Control and Prevention (CDC) and XpresSpa Group, Inc. (Nasdaq: XSPA, $1.83, +7.02%) as part of a SARS-CoV-2 surveillance project that involves voluntary sampling of arriving international travelers at select United States airports. The program is implemented through XpresSpa Group’s XpresCheck™ subsidiary and Ginkgo’s public health and biosecurity initiative, Concentric by Ginkgo. The sequence represents the first time the BA.3 sublineage has been identified in North America. State and local public health authorities have already been alerted about these cases and are taking all appropriate measures to ensure that the individuals receive the health support they need and that the spread of the viral strain is contained to the extent possible. This joint program leverages Concentric’s large-scale group testing infrastructure and XpresCheck’s in-airport testing platform to detect COVID-19 variants among international travelers. The goal of this program is to create a system that detects and provides information about the virus. Currently, the program is operating at four large airports: JFK International Airport (JFK), Newark Liberty International Airport (EWR), San Francisco International Airport (SFO), and Hartsfield-Jackson Atlanta International Airport (ATL). The program recently reported the first detection of the Omicron variant among inbound international travelers from a sample collected at a United States airport. As part of this program, Concentric performs viral sequencing on samples that are positive for SARS-CoV-2, the virus that causes COVID-19. Through testing and sequencing conducted through this surveillance program, Concentric confirmed the presence of the new BA.3 sublineage of the Omicron variant. There is presently limited data available on BA.3 and only six cases have been reported worldwide to date (none of which were in the United States). XpresSpa Group, Inc. (Nasdaq: XSPA) is a leading global health and wellness holding company operating three distinct brands: Treat™, XpresCheck™, and XpresSpa™. Treat is a travel health and wellness brand that will be providing on-demand access to healthcare through technology and personalized services. XpresCheck is a leading on-site airport provider of COVID-19 screening and testing with 14 locations in 12 domestic airports. XpresSpa is a leading airport retailer of spa services and related health and wellness products, with 43 locations in 21 airports globally. To learn more about XpresSpa Group, visit: www.XpresSpaGroup.com.

Economic Reports

On Monday, the Conference Board’s Leading Economic Index (LEI) that confirmed a 1.1% rise in November. 

Investing & Inspiration

  1. “Friendship marks a life even more deeply than love. Love risks degenerating into obsession, friendship is never anything but sharing.” – Elie Wiesel
  2. “Investing in women’s lives is an investment in sustainable development, in human rights, in future generations – and consequently in our own long-term national interests.” – Liya Kebede
  3. “Success isn’t measured by money or power or social rank. Success is measured by your discipline and inner peace.” – Mike Ditka
  4. “No matter how many goals you have achieved, you must set your sights on a higher one.” – Jessica Savitch 
  5. “Start where you are. Use what you have. Do what you can.”– Arthur Ashe
  6. “The secret of getting ahead is getting started.” – Mark Twain
  7. “The amount of work and the amount of both physical and emotional investment it takes to get to the top.” – Drew Bledsoe

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