Worldwide COVID-19 Cases Eclipse 5M Mark As Negative Macroeconomic Reports Surface to Pressure Markets Thursday

By John F. Heerdink, Jr.

We are passed the 5 million mark as we now have 5,014,943 confirmed cases of COVID-19 in the world with 1.909M cases that have recovered and more than 328k worldwide deaths. In the US, we have 1.597M confirmed cases with 303k that have recovered with 94,629 deaths. At the same time, the reopening processes across the US are proceeding for a number of states. Speaking of reopening steps, did any of you see the pictures of the white circles that were painted all over the grass at Delores Park in San Francisco in order to give people designated circle areas to sit? It truly is a very odd world we currently live in indeed. We also are receiving stimulus measures that are being pushed forward through the legislature and more, is on the way as many of us have collected their economic impact payment checks from the UST by now. Hopefully, these moves will speed up economic recovery.

However, today, the stock market added to yesterday’s decline as a number of negative macroeconomic reports surfaced. The Initial claims for the week ending May 16 confirmed a drop by 249k to 2.438M but the nine-week total is now up to a whopping 38.636M. Continuing claims for the week ending May 9 also moved significantly higher by 2.525M to 25.073M a record high. The Existing home sales report showed a double-digit drop as fell 17.8% month/month in April to a seasonally adjusted annual rate of 4.33M leaving your local real estate brokers feeling a bit empty. Lastly, the Conference Board’s Leading Economic Index dropped by 4.4% month/month in April. The Philadelphia Fed Index for May moved higher to -43.1.

10 of eleven S&P 500 sectors were in the red today. The S&P 500 closed down .78% as the energy & information technology sectors led the decline sliding 1.5 and 1.4% respectively while the industrials sector was the lone holdout that rose .2% higher. The Dow lost .41% even with Dow component and the much-maligned Boeing (BA) closing at $139/share up 4.3%. The Nasdaq closed down .97% & the Russell 2000 bumped .05% higher. 

Oil prices moved higher again today 1.3%  (~+22.8% in the last 4 days) and closed at $33.96/bbl. The reopening moves across the world and the tightening of its supply are definitely putting wind behind the sails of oil these days. Chevron (CVX) closed at $92.04/sharedown 1.03%, Exxon (XOM) closed at $44.56/share down by 1.79% & Occidental Petroleum Corporation (OXY) closed at $14.24/share down by 4.94%.  

The popular FAANG stocks mostly took the day off and closed as follows: Facebook (FB) closed at $231.39/share, up by .62% after hitting an all-time high of $237.20 and after recently announcing is the launch of e-commerce tool “shops” with Instagram, Amazon (AMZN) closed at $2,446.74/share, down 2.05%,  Apple (AAPL) closed at $316.85/share down by .75%, & Netflix (NFLX) cooled off again today dropping 2.55% closing at $436.25/share, & Alphabet (GOOG) closed at $1,402.80/share down by .28%.

The 2-yr US treasury yield moved down 1 basis point to end at .15% & the 10-yr yield ended flat at .68%. The U.S. Dollar Index strengthened by .3% to end at 99.44. 

Gold prices ended at $1,733/oz (-20) while silver prices closed at $17.4/oz (-.56). North American silver and gold producer Hecla Mining Company (HL) closed at $3.44/share down 2.48% while First Majestic Silver (AG) dropped 3.4% closing at $9.38/share.

MOVERS

  • Shares Atossa Therapeutics (ATOS) rose 25.71% closing at $2.20/share on 8.75M shares of trading yesterday and then bumped up to $2.38/share up another 8.18% today. Yesterday, Atossa Therapeutics, Inc. (Nasdaq: ATOS), a clinical-stage biopharmaceutical company seeking to discover and develop innovative medicines in areas of significant unmet medical need with a current focus on breast cancer and COVID-19, today announced the successful results from in vitro testing of AT-H201, Atossa’s proprietary COVID-19 drug candidate. The preliminary study results show that AT-H201 inhibits SARS-CoV-2 infectivity of VERO cells in a laboratory culture, which are the standard cell types being used to study the infectivity of the coronavirus. SARS-CoV-2, sometimes called the coronavirus, is the COVID-19 infectious agent. This is the first submicromolar inhibitor of SARS-CoV-2 identified to date in published literature, meaning that a relatively small amount of the drug is necessary to result in an anti-viral effect. The testing was conducted on behalf of Atossa by a leading academic research institute. Atossa plans to publish a manuscript of these test results. Successful in vitro tests do not guarantee similar results from in vivo studies, including in human clinical trials. Additional safety and efficacy studies must be successfully completed and regulatory approvals must be obtained before AT-H201 may be commercialized. AT-H201 is reportedly designed to act as a “chemical vaccine” by binding to the surface of the coronavirus and inhibiting the ability of the virus to enter a cell (“viral infectivity”). Significant findings from the testing include: AT-H201 components inhibited SARS-CoV-2 from infecting VERO cells in a laboratory culture & This is the first submicromolar inhibitor of SARS-CoV-2 identified to date in published literature, meaning that a relatively small amount of the drug is necessary to result in an anti-viral effect. Testing was also performed on Gilead Sciences’ (GILD) remdesivir, an anti-viral medication being studied by others for use in COVID-19 patients, and the generic anti-malaria drug hydroxychloroquine, which is also being studied by others in COVID-19 patients. In these laboratory tests, the components of AT-H201 were found to be at least four-times more potent than remdesivir and at least twenty times more potent than hydroxychloroquine. Potency was measured by microscopic examination of the cytopathic effect caused by SARS-CoV-2 in VERO cells. Learn More. 

 

  • Shares of L Brands, Inc. (LB) closed at $14.45/share up 18.25% as its Victoria Secret stores announced that it will close 250 stores as it is losing north of $1B.

 

  • Shares of INVO Biosciences (INVO) moved up 1.46% on a spike of the daily trading volume.

 

TOMORROW

Tomorrow’s significant economic data report schedule will not provide anything significant heading into Memorial Day 3-day weekend but the market is open for business on regularly scheduled hours.

Markets

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Big Movers

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Bond Markets & US Dollar

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Economic Reports

  • On Monday, we received the NAHB Housing Market Index Report for May, which confirmed a rise of 37 up from 30 the month before.
  • On Tuesday, we received the Housing starts report which confirmed a precipitous drop of 30.2% month/month in April to a seasonally adjusted annual rate of 891k while building permits dropped significantly by 20.8% month/month to a seasonally adjusted annual rate of 1.074M. Housing permits for single-family dwellings dropped a whopping 24.3% month/month to 669k. 
  • On Wednesday, we received the weekly MBA Mortgage Applications Index which confirmed a drop of 2.6%. 
  • On Thursday, we received the Initial claims for the week ending May 16 confirmed a drop by 249k to 2.438M but the nine-week total is now up to a whopping 38.636M. Continuing claims for the week ending May 9 also moved significantly higher by 2.525M to 25.073M a record high. The Existing home sales report showed a double-digit drop as fell 17.8% month/month in April to a seasonally adjusted annual rate of 4.33M leaving your local real estate brokers feeling a bit empty. Lastly, the Conference Board’s Leading Economic Index dropped by 4.4% month/month in April. The Philadelphia Fed Index for May moved higher to -43.1.

Agriculture & Energy

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Biotech & Healthcare

Shares Atossa Therapeutics (ATOS) rose 25.71% closing at $2.20/share on 8.75M shares of trading yesterday and then bumped up to $2.38/share up another 8.18% today. Yesterday, Atossa Therapeutics, Inc. (Nasdaq: ATOS), a clinical-stage biopharmaceutical company seeking to discover and develop innovative medicines in areas of significant unmet medical need with a current focus on breast cancer and COVID-19, today announced the successful results from in vitro testing of AT-H201, Atossa’s proprietary COVID-19 drug candidate. The preliminary study results show that AT-H201 inhibits SARS-CoV-2 infectivity of VERO cells in a laboratory culture, which are the standard cell types being used to study the infectivity of the coronavirus. SARS-CoV-2, sometimes called the coronavirus, is the COVID-19 infectious agent. This is the first submicromolar inhibitor of SARS-CoV-2 identified to date in published literature, meaning that a relatively small amount of the drug is necessary to result in an anti-viral effect. The testing was conducted on behalf of Atossa by a leading academic research institute. Atossa plans to publish a manuscript of these test results. Successful in vitro tests do not guarantee similar results from in vivo studies, including in human clinical trials. Additional safety and efficacy studies must be successfully completed and regulatory approvals must be obtained before AT-H201 may be commercialized. AT-H201 is reportedly designed to act as a “chemical vaccine” by binding to the surface of the coronavirus and inhibiting the ability of the virus to enter a cell (“viral infectivity”). Significant findings from the testing include: AT-H201 components inhibited SARS-CoV-2 from infecting VERO cells in a laboratory culture & This is the first submicromolar inhibitor of SARS-CoV-2 identified to date in published literature, meaning that a relatively small amount of the drug is necessary to result in an anti-viral effect. Testing was also performed on Gilead Sciences’ (GILD) remdesivir, an anti-viral medication being studied by others for use in COVID-19 patients, and the generic anti-malaria drug hydroxychloroquine, which is also being studied by others in COVID-19 patients. In these laboratory tests, the components of AT-H201 were found to be at least four-times more potent than remdesivir and at least twenty-times more potent than hydroxychloroquine. Potency was measured by microscopic examination of the cytopathic effect caused by SARS-CoV-2 in VERO cells. Learn More. 

Maxim Group’s Sell-side Biotech Analyst Jason McCarthy issued an update report maintaining his BUY Rating on Atossa Therapeutics,  Inc. (NASDAQ: ATOS) with a $4/share 12-month price target. View Maxim’s report here.


 

INVO Bioscience (INVO) has made a number of moves to build out its organization while focusing its efforts to increase access to its INVOcell procedure globally. INVO’s lead product, the INVOcell®, is a patented medical device used in infertility treatment and is considered an Assisted Reproductive Technology (ART). ART includes all fertility treatments in which both eggs and embryos are handled outside of the body. In general, ART procedures involve removing mature eggs from a woman’s ovaries using a needle, combining the eggs with sperm in the laboratory, and returning the embryos to the woman’s body or donating them to another woman. The main type of ART is in vitro fertilization (IVF). INVO’s 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). INVO’s mission is to increase access to care and expand fertility treatment across the globe with a goal to lower the cost of care and increase the availability of care. The Company believes the worldwide fertility treatment market to be severely underserved with only 1% to 2% of the estimated 150 million infertile couples being treated. Since January 2019, INVO Bioscience has signed commercialization agreements in the United States, as well as parts of Africa, Eurasia for the INVOcell device. On January 16, 2020, INVO and Medesole, a leading supplier of healthcare products in India and the Middle East, announced the signing of a joint venture to operate dedicated INVOcell clinics in India. According to the Indian Society of Assisted Reproduction, between 10% and 14% of Indians struggle with their fertility. In 2015, 27.5 million couples in India seeking children experienced difficulty conceiving. In urban areas, one out of six couples is impacted. According to market research, the India IVF market is expected to reach $1.45 billion by 2026, a 14.7% increase from 2019. This double-digit growth of infertility in India has made it a personal, as well as public health issue. Social stigma apart, infertility leads to tremendous financial and emotional stress for couples with the cost being a limiting factor for many couples who want to opt for this procedure. The Company further reported recently that the U.S. clinic locations which are trained to offer INVOcell have nearly tripled since their January 2019 agreement with Ferring & confirmed that each clinic location will vary in terms of implementation time and growth. Ferring has established a website, www.invocell.com, which provides information for patients and health care professionals, in addition to providing a tool to search for clinic locations that offer INVOcell.

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Consumer Goods & Trends

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Financials & Fintech

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Technology & Beyond

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Investing & Inspiration

 

 

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

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Tomorrow

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

  • The Employment Situation Report for April
  • The Wholesale Inventories for March

Videos

Please consider viewing these interesting videos: