“Eyes On German PMI” Vista Partners Daily Market Recap 9/23/19

By John Heerdink LinkedIn

All eyes were on the German PMI situation on Monday as it showed that the German economy, the European union’s largest economy,  had contracted in September & confirming that the manufacturing and service sectors worsened. September’s IHS Manufacturing PMI for Germany read 41.4, signaling the sharpest decline in business conditions across the goods-producing sector since the depths of the global financial crisis in mid-2009. New jobs were stuck in neutral as well in Germany. In contrast, the US PMI results came in increased and above expectations. Trade war news was relatively quiet but stories did flow about a possible meeting the 2nd week in October between the US and China.

As a result, we saw very little movement in the broad markets at the end of the day. The S&P 500 ended today’s session down slightly by .29points or .01% and closed at 2,991.78. The Dow gained 14.89 points closing at 26,949.99 up .06%. The tech-heavy Nasdaq closed at 8,112.46 down .06% or 5.21 points. The Russell 2000, the small-cap stock market index representing the bottom 2,000 stocks in the Russell 3000 Index lost 1.51 points down .10% and ended at 1,558.25.

In concert, Treasury yields moved lower again today. The 2-yr Treasury yield closed at 1.67% down .03 & the 10-yr yield finished lower at 1.71% down .06.

The U.S. Dollar Index closed at 98.62 up .1% on the day.

Oil prices went up today ending at $58.64/bbl up by a solid 1%%.  Chevron (CVX) closed at $124.90/share up .47%, Exxon (XOM) closed at $72.13 up by .07%. Occidental Petroleum (OXY) closed at $45.50/share up by .44%.

Gold closed at higher at $1,523.20 up 6.50. Silver closed at $18.01/oz. Hecla Mining Company (HL) closed at $2.06/share up  4.04% on the day. First Majestic Silver (AG) closed higher at $10.50/share up 4.06%.

Volatility bets were down today.   The CBOE Volatility Index (VIX) closed at $14.91/share down 2.68% or $.41/share. The 2x leveraged ETF TVIX  closed at $13.03/share down .53% or $.07/share and traded tightly between $12.66 and $13.43 today.

Economic Reports

Nothing was reported of substance regarding the economy today. Last week, on Monday, we received the Empire State Manufacturing Survey for September which showed that it had moved down to 2.0  from August’s reading of 4.8. On Tuesday, we received the Industrial production report which rose .6% month/month in August a better than expected stronger than expected result while total capacity utilization came in at 77.9%. The NAHB Housing Market Index for September was to have moved higher coming in at 68 compared to August when it came in at 67. On Wednesday, we discovered that total housing starts jumped 12.3% month/month in August ending at a seasonally adjusted annual rate of 1.364M units. Total permits also were found to risen significantly by 7.7% to 1.419M. The weekly MBA Mortgage Applications Index dropped by .1%. On Thursday, we received the existing home sales report which confirmed that we rose 1.3% m/m in August resulting in a seasonally adjusted annual rate of 5.49M million up from 5.42M in July while Total sales increased 2.6% y/y. Initial claims for the week ending Sept. 14th moved higher by 2k to 208k. Continuing claims for the week ending Sept. 7th went down by 13k to 1.661M. The Conference Board’s Leading Economic Index did not change in August. The Philadelphia Fed Index for September came in at 12. Friday we saw that nothing was reported.

Healthcare

The S&P 500 healthcare sector closed at 1059.70 off .61%. UnitedHealth (UNH) closed down 1.77% at $228.77/share, Walgreens Boots Alliance (WBA) closed at $54.32/share down 1.249% & Cigna (CI) lost .76% closing at $160.15/share.

INVO Bioscience, Inc. (IVOB) ended the day at $.27/share. Daily trading volume continues to rise in concert with their announcing progress after their exclusive U.S. partnership with Ferring Pharmaceuticals, a leader in the reproductive health industry was announced in Q1-2019. Ferring has committed to providing the necessary sales and marketing resources to more fully develop the market in the United States. There are countless couples not able to receive reproductive treatments today, and Ferring can be instrumental in addressing the unmet needs of this cohort. Ferring has the industry experience, relationships and the marketing capabilities to successfully embed the INVOcell in clinics throughout the country.  IVOB is a medical device company, headquartered in Sarasota, FL focused on creating simplified, lower-cost treatment options for patients diagnosed with infertility. The company’s lead product, the INVOcell, is a novel medical device used in infertility treatment that is FDA cleared and that enables egg fertilization and early embryo development in the woman’s vaginal cavity.

Recently, INVO Bioscience (IVOB) announced that revenues for the quarter totaled $658,638 compared to $110,210 in the second quarter of 2018, an increase of 498%. Revenue growth was driven primarily by increased product sales in the U.S. as shipments to Ferring were above expectations outlined in May 2019 as they began to increase their marketing activities. On January 14, 2019, the Company closed an exclusive U.S. licensing agreement with Ferring International Center S.A. the parent Company of Ferring Pharmaceuticals U.S. to commercialize the INVOcell™ system for use in the treatment of infertility. As part of the U.S. licensing agreement, the Company received a $5 million one-time milestone payment, with the ability to receive an additional $3 million upon obtaining a label enhancement from the U.S. Food and Drug Administration. Read Complete Story.

Biotech

The Ishares Nasdaq Biotechnology ETF (IBB) moved down .87% to close at $104.63.

Atossa Genetics (ATOS),  a Seattle-based biotech firm developing novel therapeutics and delivery methods to treat breast cancer and other breast conditions closed at $2.12/share up 1.92% today after hitting a high of $2.145/share. The average daily trading volume is 410,963 shares per day. Recently, Atossa announced that all participant activities have been completed in its Phase 1 clinical trial of a new proprietary modified-release oral tablet form of its Endoxifen. This is the next generation of oral Endoxifen following the successful clinical studies of the capsule form of the company’s oral Endoxifen. Steven C. Quay, Ph.D., M.D., CEO, and president of Atossa, commented: “We are very pleased that this study enrolled so quickly, with all 24 participants enrolled and dosed over the past six weeks. This is a very important study for Atossa as we plan to use the new modified-release oral tablet in our upcoming Phase 2 study to reduce breast density. We expect to report preliminary results from the Phase 1 study in the next 30 days and then move forward with the Phase 2 study in the fourth quarter. Ultimately, the goal of the modified-release aspect of the drug is to create more even uptake of the drug which we believe may reduce side effects and improve efficacy.” The Phase 1 study is being conducted in Australia. The objectives of the study are to assess safety and tolerability and to ascertain the pharmacokinetics of the tablet. The study is randomized, double-blinded and placebo-controlled with both single and multiple-doses (daily for 14-days) in two groups with a total of 24 healthy female volunteers. Atossa’s oral Endoxifen capsule served as the comparator.

Atossa presented last week at the Rodman & Renshaw Conference in NYC and published their updated presentation that included their near term milestones on page 23. It includes a milestone regarding their Oral Endoxifen Phase 1 trial where they expect to reveal their “results from Phase 1 study of the new modified-release tablet” this month (September 2019.)

Neubase (NBSE) has developed 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. NeuBase has improved gene silencing therapies to include the advantages of synthetic approaches with the precision of antisense technologies. After the close today sell-side firm BTIG initiated coverage on Neubase with a “Buy” recommendation and $15/share target price. Immediately following the closing of the Neubase’s July merger, the Company entered into a definitive purchase agreement for the sale of NeuBase common stock with Greenlight Capital. Upon the close of the private placement, Greenlight Capital owned ~9% of NeuBase common stock. David Einhorn, President of Greenlight Capital, added, “We are excited to be investing in NeuBase, given its initial focus on neurological disorders, and we believe its unique, next-generation technology may offer great help for victims of some of the most difficult to treat diseases.”  Shares of NBSE closed today’s trading at $6.55/share.

Onconova Therapeutics, Inc. (ONTX) is a Phase 3 stage biopharmaceutical company discovering and developing novel products to treat cancer, with a focus on Myelodysplastic Syndromes (MDS). Today ONTX announced that it has entered into securities purchase agreements with certain institutional and accredited investors to purchase an aggregate of 2,136,193 shares of its common stock, at a purchase price of $1.60 per share in a registered direct offering for aggregate gross proceeds of approximately $3.4 million. The offering is expected to close on or about September 25, 2019, subject to the satisfaction of customary closing conditions.H.C. Wainwright & Co. is acting as the exclusive placement agent for the offering. Onconova also has agreed that for each share of common stock purchased in the offering by an investor, a corresponding number of warrants of Onconova that were issued to such investor in February 2018 and/or April 2018, as applicable, will be amended to have a reduced exercise price of $1.60 per share and the term of exercise will be extended to December 31, 2022. Shares of ONTX closed today’s trading at $1.15/share down 28.13% on 1,571,355 shares of trading volume after hitting a 52-week low of $1.13. The 52-week high is $11.17.

Merck (MRK), known as MSD outside the United States and Canada, recently announced that the U.S. Food and Drug Administration (FDA) approved supplemental New Drug Applications (NDAs) for PIFELTRO™ (in combination with other antiretroviral agents) and DELSTRIGO™ (as a complete regimen) that expand their indications to include adult patients with HIV-1 infection who are virologically suppressed (HIV-1 RNA less than 50 copies per mL) on a stable antiretroviral regimen with no history of treatment failure and no known substitutions associated with resistance to PIFELTRO or the individual components of DELSTRIGO. MRK shares closed at $84.36/share down .94%.

Tech

Apple (AAPL) closed at $218.72/share up .45%, Alphabet (GOOG) closed at $1234.03/share up .33%, Facebook (FB) closed at $186.82/share down 1.64%, NVIDIA (NVDA) closed at $174.84/share up 1.25%, & Netflix (NFLX) closed at $265.92/share down by another 1.78% after the CEO formarly recently cited that Disney’s (DIS) streaming offering Disney+ will be stiff competition. Microsoft (MSFT) closed at $139.14 down .22% & IBM closed at $142.07 up .13% while Cisco Systems (CSCO) lost .36% finishing at $49.42/share.



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