Q2 2020 Produces Market Records With More Stimulus In Mnuchin & Powell’s View Plus $1800/oz Gold

Buoyed by stimulus packages in play over the last couple of months and with more stimulus measures in their sites today, the markets rose again as they have done almost dependably throughout the 2nd quarter. Q2 also brought forth a new all-time record high on the Nasdaq while also producing the best quarter ever on the Dow, a more than solid move of on the S&P of nearly 20% and Russell grabbed back allot of what it lost in the drop.  The Dow and Nasdaq rose about 17.5% and 30%, respectively, during the second qua Today, the Dow 30 gained .85% closing at 25,812.88, the S&P 500 gained 1.54% closing soundly over the 3k mark at 3,100.29, the Nasdaq gained 1.87% now at 10,058.77, and the Russell 2000 added 1.42% closing at 1,441.37.  

Today’s move came along with the Fed’s Chair Jerome Powell & Treasury Secretary Steven Mnuchin’s testimonial before the House Financial Services Committee where they reviewed the stimulus measures that have been launched into motion to date along with their suggestions for the need and their expectations of more stimulus funding that could be approved by as soon as the end of July.

The markets also embraced three macroeconomic reports that showed improvements which included the following: (1) the Conference Board’s Consumer Confidence Index for June confirmed a rise to 98.1, (2) the Chicago PMI report for June confirmed a rise to 36.6, & (3) the S&P Case-Shiller Home Price Index report confirmed a rise of 4% in April.

Gold rose above $1800/0z for the first time since 2011 closing at $1,801.50 (+1) & silver prices closed at $18.45/oz (+.42). Could this be finally the time that we see gold and silver skyrocket along with the equities playing involved in the sector?  With that in mind, today, North American silver and gold producer Hecla Mining Company (HL) closed at $3.27/share up 6.51% while First Majestic Silver (AG) gained 5.63% closing at $9.95/share.

FAANG stocks also ended positive overall as follows: Facebook (FB) closed at $227.07/share up 2.91%, Amazon (AMZN) closed at $2,758.82/share up 2.93%,  Apple (AAPL) closed at $364.80/share up .83%, Netflix (NFLX) gained 1.74% closing at $455.04/share & Alphabet (GOOG) closed at $1,413.61/share up 1.34%.

On a somber note, oil prices dropped 1% closing at $39.28/bbl, however energy leaders Chevron (CVX) closed at $89.23/share up 1.78%, Exxon (XOM) closed at $44.72/share up .9% & highly leveraged Occidental Petroleum Corporation (OXY) closed at $18.30/share up 2.46%. Midstream player, Enterprise Products Partners (EPD), closed trading at $18.17/share up 3.65% and currently sports at an attractive $1.78/share dividend or 10.15%. 

The 2-yr US treasury yield moved lower by one basis point to .15% & the 10-yr yield rose 2 basis points at .65%. The U.S. Dollar Index weakened by .2% to end at 97.38. 

MOVERS

Here’s a couple of other equities that moved significantly higher today:

• Shares of Vir Biotechnology, Inc, (VIR) rose 12.80% closing at $40.97/share today after publishing data in the journal Nature on its S309, a monoclonal antibody that is believed to target SARS-CoV-2.

• Shares of Tandem Diabetes Care, Inc. (TNDM) jumped 12.65% closing at $98.92/share as they announced that Abbott Laboratories’ (ABT) Freestyle Libre continuous glucose monitoring technology with Tandem’s insulin delivery products to provide options to simplify and tailor diabetes management. 

Tomorrow’s significant economic data report schedule will be busy with the following:

• The ISM Manufacturing Index for June
• The ADP Employment Change report for June
• The FOMC Minutes from the June meeting,
• The Construction Spending for May
• The weekly MBA Mortgage Applications Index
• The auto and truck sales for June

WATCH LIST

• Atossa Therapeutics (NASDAQ: ATOS), which is working on two COVID-19 programs, closed at $3.80/share. They did not report any news, but Dr. Steven Quay, MD, Ph.D., author, and physician-scientist, was recently interviewed on FOX 26 Houston this week and the show was titled “Company developing nasal spray to treat COVID-19.” Again as I mentioned yesterday, I believe it is worth the time for all to view this story here as it sheds a great deal of light on the 4 stages of COVID-19 and their potential treatments. He has also recently published the following book “Your COVID-19 Survival Manual: A Physician’s Guide to Keep You and Your Family Healthy During the Pandemic and Beyond,” in paperback and eBook format on his website, www.DrQuay.com. Proceeds from the book will go to military veterans performing COVID-19 relief work in their communities.  You may order it here.

• Shares of INVO Bioscience (INVO) closed at $3.93/share up 4.8%. This week, INVO announced the second closing of its convertible note and unit purchase option private placement. The Company had previously conducted the first closing on May 15, 2020. The combination of both closings resulted in gross proceeds of $3,093,640 (of which $2,950,000 was received in cash and $143,640 resulted from cancellation of indebtedness. Steve Shum, Chief Executive Officer of INVO stated, “We appreciate the financial support from our investors as we execute our mission toward increasing patient access and treatment within the infertility marketplace through our revolutionary INVOcell device, an affordable, scalable and effective solution. We continue to push forward with our global commercialization efforts with our major U.S. partner, along with our current partners in Africa, Eurasia, and India; and are pursuing many other key regions and partners in Central and South America, Europe, and Asia Pacific.” The Company had previously announced on May 22, 2020, that it had effected a 1-for-20 reverse stock split reducing the amount of issued and outstanding common shares to approximately 7.89 million common shares. The reverse split was previously approved by the Company’s Board of Directors pursuant to the authority granted by the Company’s stockholders at the Company’s annual shareholder meeting held on December 16, 2019. Learn more about INVO by reading my interview: A Vista Partners Interview With Steve Shum CEO of INVO Bioscience Regarding Increasing Access To Care For Fertility Treatment.

• Shares of Fate Therapeutics (FATE) closed at $34.31/share up from its 52-week low of $12.59 and just shy of its 52-week high of $37.24/share. On June 11th, NBSE recently announced that it had closed an underwritten public offering of 7,108,796 shares of its common stock, which included 927,324 shares that were issued pursuant to the full exercise of the underwriters’ option to purchase additional shares, at a public offering price of $28.31 per share. Aggregate gross proceeds from this offering, including the exercise of the option, were approximately $201.3 million, prior to deducting underwriting discounts and commissions and estimated offering expenses. Fate Therapeutics, Inc. (FATE), a clinical-stage biopharmaceutical company dedicated to the development of programmed cellular immunotherapies for cancer and immune disorders. Are you still invested in Fate after meeting them via this newsletter and attending meetings over the last couple of years when it was in the $3-4 range?… Recently, Fate announced that the U.S. Food and Drug Administration (FDA) has cleared the Company’s Investigational New Drug (IND) application for FT538, the first CRISPR-edited, iPSC-derived cell therapy. FT538 is an off-the-shelf natural killer (NK) cell cancer immunotherapy that is derived from a clonal master induced pluripotent stem cell (iPSC) line engineered with three functional components to enhance innate immunity: a novel high-affinity, non-cleavable CD16 (hnCD16) Fc receptor; an IL-15/IL-15 receptor fusion (IL-15RF); and the elimination of CD38 expression. The Company plans to initiate a clinical investigation of three once-weekly doses of FT538 as monotherapy in acute myeloid leukemia (AML) and in combination with daratumumab, a CD38-directed monoclonal antibody therapy, for the treatment of multiple myeloma.

• Shares of Neubase Therapeutics (NBSE) closed at $8.78/share. RBC Capital Markets recently initiated coverage of NBSE today with an Outperform, Speculative Risk rating & a $16 price target. As we have been stating, we are following Neubase Therapeutics (NBSE) for a number of reasons including its development of a modular antisense peptide nucleic acid (PNA) platform with the capability to address rare genetic disease caused by mutant proteins with a single, cohesive approach. NBSE was added to the Russell 3000 last Friday.

• Shares of Stereotaxis, Inc. (STXS) closed at $4.46/share down 1.33% after hitting an intraday high of $5.31/share. The 52-week range is $1.70 – $5.82/share. The global leader in innovative robotic technologies for the treatment of cardiac arrhythmias continues to gain traction after their webcast symposium was held this weekend where they held a live broadcast of their bi-directional TeleRobotic procedures with physicians navigating catheters from hospitals more than 1700 km apart. They were recently added to the Rusell 2000 and the Russell 3000 indexes.

• Shares of Aduro (ADRO) closed at $2.31/share today up 3.12%. On June 2nd, Aduro Biotech, Inc.(ADRO) and Chinook Therapeutics, Inc., a privately-held clinical-stage biotechnology company focused on the discovery, development, and commercialization of precision medicines for kidney diseases, today announced that the companies have entered into a definitive merger agreement pursuant to which Aduro will acquire all of the outstanding capital stock of Chinook in exchange for shares of Aduro common stock representing approximately 50 percent of Aduro’s outstanding common stock immediately following completion of the transaction. The combined company is expected to have approximately $200 million in cash, cash equivalents, and marketable securities at closing, including $25 million in additional financing committed by Chinook’s existing investors. Following closing, which is expected to occur in the second half of 2020, Aduro will be renamed Chinook Therapeutics, Inc., and is expected to trade on the Nasdaq Global Market under the ticker symbol “KDNY”. Yesterday, ADRO announced that the first patient with IgA nephropathy has been dosed in a Phase 1 clinical trial of BION-1301, an investigational humanized IgG4 monoclonal antibody that blocks APRIL binding to both the BCMA and TACI receptors. “We are thrilled to have dosed the first patient with IgA nephropathy in the Phase 1 clinical study of our investigational anti-APRIL antibody, BION-1301,” said Dimitry S.A. Nuyten, M.D., Ph.D., chief medical officer of Aduro. “The data Aduro recently presented from Parts 1 and 2 of this study in healthy volunteers at the 57th ERA-EDTA Virtual Congress indicated BION-1301 was well-tolerated, had a half-life of approximately 33 days, achieved over 90% target engagement with a single 450 mg dose of BION-1301 and demonstrated dose-dependent and durable reductions in IgA and IgM levels, and to a lesser extent, IgG levels. We look forward to hopefully replicating this effect in addition to exploring BION-1301’s disease-modifying potential in patients with IgA nephropathy in Part 3 of the ongoing Phase 1 clinical study.”

Economic Reports

• On Monday, we received the pending home sales report which confirmed a 44.3% month/month sizable jump in May.
• On Tuesday, we received the Conference Board’s Consumer Confidence Index for June which confirmed a rise to 98.1, the Chicago PMI report for June which confirmed a rise to 36.6, & the S&P Case-Shiller Home Price Index report which confirmed a rise of 4% in April.

Investing & Inspiration

“An investment in knowledge pays the best interest.” – Benjamin Franklin.

“I believe the returns on investment in the poor are just as exciting as successes achieved in the business arena, and they are even more meaningful!” -Bill Gates

“Every portfolio benefits from bonds; they provide a cushion when the stock market hits a rough patch. But avoiding stocks completely could mean your investment won’t grow any faster than the rate of inflation.” – Suze Orman

“The tax on capital gains directly affects investment decisions, the mobility, and flow of risk capital… the ease or difficulty experienced by new ventures in obtaining capital, and thereby the strength and potential for growth in the economy.” – John F. Kennedy

“If all the economists were laid end to end, they’d never reach a conclusion.
-George Bernard Shaw

“The riskiest thing we can do is just maintain the status quo.
I get up at 4:30 in the morning, seven days a week, no matter where I am in the world. I think it is important for people who are given leadership roles to assume that role immediately. What I’ve really learned over time is that optimism is a very, very important part of leadership.” Bob Iger, Ceo of Disney

“There are old traders and there are bold traders, but there are very few old, bold traders.”-Ed Seykota

“Let this scenario play out on its own, in its own fashion. As you watch it unfold, you will soon be grateful that you choose the peaceful path. Remember — those who live by the sword, die by the sword.”

“As long as you enjoy investing, you’ll be willing to do the homework and stay in the game.” -Jim Cramer

“I rarely think the market is right. I believe non-dividend stocks aren’t much more than baseball cards. They are worth what you can convince someone to pay for it.” -Mark Cuban

“Michael Marcus taught me one other thing that is absolutely critical: You have to be willing to make mistakes regularly; there is nothing wrong with it. Michael taught me about making your best judgment, being wrong, making your next best judgment, being wrong, making your third best judgment, and then doubling your money.” -Bruce Kovner

“The policy of being too cautious is the greatest risk of all.” -Jawaharlal Nehru

“The only true test of whether a stock is “cheap” or “high” is not its current price in relation to some former price, no matter how accustomed we may have become to that former price, but whether the company’s fundamentals are significantly more or less favorable than the current financial-community appraisal of that stock.” -Philip Fisher

“I learned to avoid trying to catch up or double up to recoup losses. I also learned that a certain amount of loss will affect your judgment, so you have to put some time between that loss and the next trade.” -Richard Dennis

“The four most dangerous words in investing are: ‘this time it’s different.” -Sir John Templeton

“Money doesn’t make you happy. I now have $50 million but I was just as happy when I had $48 million.” -Arnold Schwarzenegger