There Seemed To Be Nearly ‘No Where To Hide’ During Thursday’s Market Selloff!

Thursday’s markets missed having any form of savior of sorts stating that ‘all things will be fixed’ as it had enjoyed from the Powell-Schumer combo the last couple of days and it pretty much declined from start to finish.  The yield curve continued to be popularly blamed for the downward pressure on the markets as rates spiked again much to the chagrin of Jerome Powell and co. In fact, there did not seem to be too many places to hide as all indices finished significantly in the red as follows: Dow 30 closed at 31,402.01 (-1.75%), the S&P 500 closed at 3,829.34 (-2.45%), the small caps on the Russell 2000 closed at 2,200.17 (-3.69%) and the Nasdaq closed at 13,119.43 (-3.52%) leaving it down over 8.5% from its recent new all-time high and seemingly pushing much closer to a normal 10% correction. All 11 sectors closed deeply in the red led by declines in the highly followed, weighted, & admired consumer discretionary sector that fell 3.6% & the information technology sector that dropped 3.5%. 

MORE POSITIVE MACRO & POPPING YIELDS

The macroeconomic schedule however delivered mostly positive data as the initial claims report for the week ending February 20 which showed a drop of 111k to 730k while continuing claims for the week ending February 13 dropped by 101k to 4.419M. The Durable Goods Orders report for January moved up 3.4% month/month. The second estimate for Q4 GDP was revised upward slightly to 4.1%. The GDP Price Deflator was moved up to 2.1%. The Pending home sales report confirmed a drop by 2.8% month/month in January. Tomorrow, the schedule will deliver the Personal Income and Spending report for January, the PCE Prices report for January, the final University of Michigan Index of Consumer Sentiment report for February, & the Adv. Intl. Trade in Goods report, the Retail Inventories report, & the Wholesale Inventories report for January.

 The 2-yr treasury yield moved up 4 basis points to .17%, while the 10-yr treasury yield moved up 13 basis points ending at 1.52%. Curiously, the current dividend yield on the S&P 500 equally closed at 1.52% +3.73 bps.

The U.S. Dollar also ticked higher to end at 90.25.

FAANG’s & Tesla Ugly, ‘Twitteriffic’ & GameStop Continued?

The FAANG’s ended ugly across board as follows: Apple (AAPL) shares closed at $120.99, -3.48% (Apple has reportedly acquired 100 companies over the last six years & they recently announced its largest quarter ever (by revenue) clocking in with $111.4B in the first quarter of its fiscal year 2021), Amazon (AMZN) ($3,057.16, -3.24%), Alphabet (GOOG) closed at $2,031.36,-3.05%, Facebook (FB) closed at $254.69, -3.64%, & Netflix (NFLX) closed at $546.70/share, -1.21%.

Shares of EV giant Tesla (TSLA) fell sharply closing at $682.22, -8.06%.  Shares of the leading provider of hydrogen engines and fueling solutions enabling e-mobility Plug Power (PLUG) closed at $43.34, -13.6% after reporting Q4 2020 and Year end results  while confirming $337 million in Gross Billings for 2020, Up 42.5% Year over Year. Review their complete quarterly shareholder letter  posted at http://www.ir.plugpower.com/Q420Plug. Plug also announced that is growing its green hydrogen footprint in New York with construction of a new state-of-the-art green hydrogen production facility and electric substation in the New York Science, Technology and Advanced Manufacturing Park (STAMP) &  that Plug and SK Group, one of the leading South Korean business groups, completed the previously announced $1.6 billion capital investment to partner in accelerating hydrogen as an alternative energy source in Asian markets. 

NVIDIA Corporation (NVDA) achieved a new all-time high of $614.90 last week prior to closing at $532.30, -8.22% today. NVDA has risen greatly during the ongoing “global chip shortage” as their chips power the future of self-driving cars and cloud gaming. Yesterday, NVDA reported record revenue for the fourth quarter ended January 31, 2021, of $5.00 billion, up 61 percent from $3.11 billion a year earlier, and up 6 percent from $4.73 billion in the previous quarter. The company’s Gaming and Data Center platforms achieved record revenue for the quarter and year.

It was a ‘Twitteriffic’ kind of day for Twitter’s (TWTR) shareholders as it rose to a new all-time high of $80.75 prior to ending at $74.59, +3.71%. The company revealed a long-term growth plan that includes a goal to double total annual revenue to $7.5 billion in 2023. They will also allow you to charge for premium content with a new ‘Super Follows’ feature.

The much maligned and Reddit-Robinhood & now politically followed Gamestop (GME) continued its torrid move upward today to a intraday high of $184.68 prior closing at $108.73, +17.02%. This is quite remarkable when you look at the fact that it was as low as $44 yesterday & nothing earth shattering has publicly been announced other than a CFO’s resignation. Having said that, I do not begrudge any investor that is making money on the way up or way down on this incredibly volatile stock. I wish all the best in their individual search to make money in this issue or any issue. Good luck!

BIOTECH & HEALTHCARE

The iShares Nasdaq Biotechnology ETF (IBB) closed at 157.15, -2.65% while the NYSE ARCA Biotech Index (^BTK) closed at 5,755.37, -2.8%. 

Yesterday, ChromaDex Corp. (NASDAQ: CDXC) ($18.74, +92,4%) announced results from the study “Combined Metabolic Activators Accelerates Recovery in Mild-to-Moderate COVID-19” that were published Feb. 20 on medRxiv, a preprint publication website. The Phase 3 study demonstrated that patients with mild-to-moderate COVID-19 receiving standard of care experienced a 3.5 day reduction in recovery time when receiving an added nutritional protocol. Aimed at improving mitochondrial function, the protocol included nicotinamide riboside (NR), L-serine, N-acetyl-L-cysteine (NAC), and L-carnitine tartrate. The results of the study, which took place in conjunction with the ChromaDex External Research Program (CERP) and ScandiBio Therapeutics, build on findings from Phase 2 clinical data published in October 2020. The addition of the nutritional protocol, or combined metabolic activators (CMA), to the Turkish standard of care not only reduced recovery time but improved liver health and decreased levels of inflammatory markers.

Today, Atossa Therapeutics (ATOS) ($2.91, +4.68%) announced final results from its Phase 1 double-blinded, randomized, placebo-controlled clinical study using Atossa’s proprietary drug candidate AT-301 administered by nasal spray. AT-301 was considered to be safe and well tolerated in healthy male and female participants in this study at two different dose levels over 14 days. AT-301 is being developed for at home use for patients recently diagnosed with COVID-19. There are currently no FDA-approved therapies to treat COVID-19 at home. Steven Quay, M.D., Ph.D., Atossa’s President and CEO stated, “The results from this study are very encouraging and we look forward to quickly commencing the next study of AT-301. We recently received input from the FDA on this program and based in part on that input, we are now preparing to conduct an additional pre-clinical study, which we expect to start this quarter. Following that, we expect to apply to the FDA to commence a Phase 2 study here in the United States.”

GOLD, SILVER, HL

The iShares Silver Trust ETF (SLV) closed at $25.40, -2.08% & the SPDR Gold Shares (GLD) closed at $165.82, -1.88%. Silver prices closed at $27.54/oz, -$.46. Gold prices closed at 1,772, -$33.

North American Silver and gold producer Hecla Mining Company (HL) closed at $6.89/share, -6.39% on the day after recently establishing a new 52-week high of $8.45 this week. HL’s 52-week range is $1.4 – $8.45. Last week, Hecla announced Q4 and full year 2020 financial and operating results. Phillips S. Baker, Jr., President and CEO of Hecla stated, “The COVID pandemic provided significant challenges to Hecla and the mining industry; however, due to our people and the jurisdictions we operate in, Hecla exceeded the high end of our pre-COVID silver guidance by 1.4 million ounces. We saw modest disruptions in Quebec and Mexico; however, these did not materially impact our business. During the year we refinanced our long-term debt now due in 2028, and through solid free cash flow generation, added cash to the balance sheet, reduced our net debt, and increased dividends. As we look to 2021, we see three significant value drivers. First, with Lucky Friday running at full production, positive results from the work at Casa Berardi, and the continued consistency of Greens Creek, we expect to grow silver production and generate significant free cash flow. Silver production from our United States silver mines is expected to go from 8 million ounces in 2018 to almost 15 million ounces by 2023, further increasing Hecla’s position as the most significant US silver producer. Second, we start the year with the 3rd highest reserves in our history despite disruptions to our planned exploration and definition drilling programs due to COVID‑19, and we expect reserve growth in 2021 from a normal drilling program. Finally, Hecla’s 2021 exploration program is following up on high-grade intercepts that have the potential to expand existing or develop new high-quality deposits in some of the world’s best mining jurisdictions. Examples of this are Midas’ Green Racer Sinter target where we have made a multi-ounce gold discovery in a never before drilled target and at San Sebastian’s El Bronco vein where we are seeing high-grade over significant widths.”

I recently hosted a Tribe Public Webinar Presentation and Q&A Event last week with Phillips S. Baker, Jr., President, and CEO of Hecla Mining Company (NYSE: HL) where we discussed “The Silver Squeeze” while addressing questions from the Tribe and offering valuable insights on silver prices throughout history and the recent volatility that helped move silver related stocks and the ETF SLV. Please view it by clicking here.  

VP WATCHLIST HIGHLIGHTS

Economic Reports

• On Monday, the Conference Board’s Leading Economic Index report confirmed a rise by .5% month/month in January.
• On Tuesday, the Conference Board’s Consumer Confidence Index report which confirmed a rise to 91.3 in February. The FHFA Housing Price Index report confirmed a rise by 1.1% in February. The S&P Case-Shiller Home Price Index report confirmed an rose by 10.1% in December.
• On Wednesday, the new home sales report confirmed a 4.3% month/month rise to a seasonally adjusted annual rate of 923k in January & on a year/year it is now up 19.3%. The weekly MBA Mortgage Applications Index fell 11.4%. 
• On Thursday, the initial claims report for the week ending February 20 which showed a drop of 111k to 730k while continuing claims for the week ending February 13 dropped by 101k to 4.419M. The Durable Goods Orders report for January moved up 3.4% month/month. The second estimate for Q4 GDP was revised upward slightly to 4.1%. The GDP Price Deflator was moved up to 2.1%. The Pending home sales report confirmed a drop by 2.8% month/month in January.

Investing & Inspiration

1. “Men, it has been well said, think in herds. It will be seen that they go mad in herds, while they only recover their senses slowly, and one by one.” – Charles Mackay
2. “It’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.” – George Soros
3. “No Price is too low for a bear or too high for a bull.” — Anonymous
4. “Investment is an asset or item that is purchased with the hope that it will generate income or appreciate in the future.” Anonymous
5. “Behind every stock is a company. Find out what it’s doing.” — Peter Lynch
6. “Wise spending is part of wise investing. And it’s never too late to start.” –Rhonda Katz
7. “It amazes me how people are often more willing to act based on little or no data than to use data that is a challenge to assemble.” ― Robert Shiller
8. “A bull market is like sex. It feels best just before it ends.” — Barton Biggs
9. “The investor’s chief problem — even his worst enemy — is likely to be himself.” — Benjamin Graham
10. “No profession requires more hard work, intelligence, patience, and mental discipline than successful speculation.” – Robert Rhea
11. “Money is like a sixth sense – and you can’t make use of the other five without it.” – William Somerset Maugham
12. “Compound interest is the eighth wonder of the world. He who understands it, earns it. He who doesn’t, pays it.” — Albert Einstein
13. “Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good results” — Warren Buffett
14. “The stock market is a device for transferring money from the impatient to the patient.” – Warren Buffett
15. “Thousands of experts study overbought indicators, head-and-shoulder patterns, put-call ratios, the Fed’s policy on money supply…and they can’t predict markets with any useful consistency, any more than the gizzard squeezers could tell the Roman emperors when the Huns would attack.” – Peter Lynch
16. “Investing puts money to work. The only reason to save money is to invest it.” – Grant Cardone
17. “You cannot save time for your future use however you can invest time for your future.” – John F. Heerdink, Jr. 
18. “Know what you own, and know why you own it.” – Peter Lynch
19. “Liquidity is only there when you don’t need it.” -Old Proverb
20. “If you want to be a millionaire, start with a billion dollars and launch a new airline.” – Richard Branson
21. “Fear incites human action far more urgently than does the impressive weight of historical evidence.” – Jeremy Siegel
22. “In investing, what is comfortable is rarely profitable.” – Robert Arnott
23. “Spend each day trying to be a little wiser than you were when you woke up.” – Charlie Munger
24. “The entrance strategy is actually more important than the exit strategy.” – Edward Lampert
25. “The rivers don’t drink their own water; Trees don’t eat their own fruits. The sun does not shine for itself, And flowers do not spread their fragrance For themselves. Living for others is a rule of nature” – Pope Francis
26. “It is impossible to produce superior performance unless you do something different from the majority.” – John Templeton
27. “An investment in knowledge pays the best interest.” – Benjamin Franklin.
28. “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
29. “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
30. “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
31. “If all the economists were laid end to end, they’d never reach a conclusion. -George Bernard Shaw
32. “There are old traders and there are bold traders, but there are very few old, bold traders.”-Ed Seykota
33. “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.”
34. “As long as you enjoy investing, you’ll be willing to do the homework and stay in the game.” -Jim Cramer
35. “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
36. “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
37. “The policy of being too cautious is the greatest risk of all.” -Jawaharlal Nehru
38. “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
39. “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
40. “The four most dangerous words in investing are: ‘this time it’s different.” -Sir John Templeton
41. “Money doesn’t make you happy. I now have $50 million but I was just as happy when I had $48 million.” -Arnold Schwarzenegger