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“Tumbling Markets, Shelter In Place In Bay Area, VIR & INVO Rise” Vista Partners Daily – March 16, 2020

By John F. Heerdink, Jr.

The US Government and the Fed continue to push forward stimulus measures as we continue to rollout containment steps to fight the spread of the coronavirus. Here in the Bay Area, we stopped short of being lockdown today, but are now ordered to “shelter in place” at 12:01 am on Tuesday until April 7. This means that we will be required to remain indoors except for essential travel, like going to go out for our new favorite activity of “panic buying” groceries. Filling up the gas tank is getting easier on the pocketbook too, partly because we are not going anywhere, and also due to the fact that oil prices seem to be dropping daily. Oil closed at $28.69/bbl down another -$4.24//bbl or  -12.88%. The S&P 500 energy sector was off -13.63%.

US treasury yields dropped again today as the 2-yr yield closed at .374% while the 10-yr yield closed at .74% and the 30-yr closed at 1.315. The U.S. Dollar Index also weakened by -.68% to close a 98.07. As we all know now as of yesterday the target range for the fed funds rate was cut to .0% to .25%. The discount rate was cut to .25% We also saw the Fed initiate a $700B quantitative easing (QE) program. Now we also have systemative central bank action in order to enhance liquidity by standing U.S. dollar liquidity swap line arrangements while we wait March 26 when the bank reserve requirement ratios will be reduced to 0%. Another stimulus proposal in the $800B range is supposedly in the works. A key economic point surfaced today as the New York Fed’s Empire State Manufacturing Survey was confirmed to have dropped to -21.5 in March.

At the close of trading the S&P 500 dropped by -11.98%, the Dow dropped by -12.93%, the Nasdaq dropped by -12.32% & the Russell dropped by -14.27%. The FAANG stocks drove down the slippery, steep, & jagged road of the markets again today. Facebook (FB) closed at $146.01/share, -14.25% hitting a new 52-wk low of $143.10, Alphabet (GOOG) closed at $1,084.33/share, -11.10%, Amazon (AMZN) closed at $1,689.15/share, -5.32% after establishing its new 52-wk low of $1626.03, Apple (AAPL) closed at $242.21/share -12.86%  & Netflix (NFLX) closed at $298.84/share, off -11.14%.

With yet another negative trading session, the Velocity Shares Daily 2x VIX Short-Term ETN (TVIX), a leveraged “bet” against the market rising, closed at $591.25/share up an amazing  +76.28% prior to achieving a new 52-wk high of $626.67. TVIX’s 52-wk low which was not long ago is $38.33/share.

San Francisco’s Vir Biotechnology (VIR) continued to be a bright spot rising another +4.81% to close at $45.76/share. Vir announced last week that it has signed a letter of intent with Biogen Inc. (BIIB) for the development and clinical manufacturing of human monoclonal antibodies for the potential treatment of COVID-19, the disease caused by the SARS-CoV-2 virus. Because of the urgency of the situation, the companies have begun work while a Clinical Development and Manufacturing Agreement is being negotiated. Subject to the completion of a definitive agreement, Biogen would continue cell line development, process development, and clinical manufacturing activities in order to advance the development of Vir’s proprietary antibodies. week a research collaboration agreement with the National Institutes of Health (NIH) and the National Institute of Allergy and Infectious Diseases (NIAID), Vaccine Research Center (VRC) to advance characterization and development of human monoclonal antibodies (mAbs) against coronaviruses, including SARS-CoV-2, the virus that causes the disease COVID-19. The joint project, which will begin this week, will augment ongoing efforts by both parties to identify antibodies that can be used to prevent or treat the infection with existing and emerging viruses and help inform the development of vaccines. Under the terms of the agreement, Vir and NIAID will work together to identify and optimize combinations of antibodies against coronaviruses, including SARS-CoV-2, SARS, and MERS, as well as antibodies that may be effective across additional types of coronaviruses. The two parties will exchange antibodies and other materials for testing in combination and individually and, by mutual agreement, will perform in vivo animal studies to analyze immune responses.

Another positive spot in the markets today came from INVO Bioscience as it announced that its board of directors has approved a change in the Company’s trading symbol from “IVOB” to “INVO.” The change in the trading symbol commenced at the market open today, March 16, 2020. All market-related information on the OTC Markets will be reported under the new symbol effective March 16, 2020. The CUSIP number for the Company’s common stock will remain unchanged. INVO is an emerging medical device company focused on creating alternative treatments for patients diagnosed with infertility and developers of INVOcell®, an FDA-cleared INVOcell technology provides an in-vivo incubation solution which can help increase access and capacity to the large underserved global fertility market, is another player emerging in the fertility space. The INVO Procedure is a revolutionary in vivo method of vaginal incubation that offers patients a more natural and intimate experience. INVO’s lead product, the INVOcell, is a patented medical device used in infertility treatment and is considered an Assisted Reproductive Technology (ART). The INVOcell is the first Intravaginal Culture (IVC) system in the world used for the natural in vivo incubation of eggs and sperm during fertilization and early embryo development, as an alternative to traditional In Vitro Fertilization (IVF) and Intrauterine Insemination (IUI).  Shares of INVO rose +19.11% at the close after nearly doubling in intraday trading. 

“With the growing awareness and usage of our INVOcell device, we believe it made strategic sense to align our public market trading symbol with our corporate name and our innovative fertility solution to improve the consistency of our branding along with our overall recognition within the investment community. The progress we are making with market development, awareness and commercialization of INVOcell drove our decision to make the symbol change. We remain excited about INVOcell’s position in the marketplace along with the key underlying long-term trends within the overall Assisted Reproductive Technology (ART) market. We continue to spend our focused efforts on evaluating additional partners to enter other key market areas around the world and look forward to continuing to update the shareholders on our progress as we move forward,” stated Steve Shum, CEO of INVO Biosciences.

Hang on to your seats again tomorrow as for sure volatility is here to stay in the markets!

Which ETF will you or would you be betting on tomorrow? The bearish TVIX?  Or will the bullish TQQQ be your cup of tea?  Looking forward to getting your responses… By the way, I like the TQQQ for at least a bounce play tomorrow morning after this harsh sell-off today.

Economic Reports

On Monday, the New York Fed’s Empire State Manufacturing Survey was confirmed to have dropped to -21.5 in March.

Investing & Inspiration

 

 

 

“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

Tomorrow

Tomorrow’s significant economic data report schedule will include the following:

  • The preliminary University of Michigan Index of Consumer Sentiment for March
  • The Export and Import Prices for February

Videos

Please consider viewing these interesting videos: