“Inverted Confidence” Vista Partners Daily Market Recap 8/27/19

By John Heerdink LinkedIn

After a positive start to the week, the markets ushered in an ‘”inverted” sort of day today as the US yield curve turned for the worse and ended inverted while the Conference Board’s Consumer Confidence Index for August came in at 135.1 confirming a relatively strong consumer confidence position in the US regarding spending.  We have an inverted yield curve when short-term investments in US Treasury bonds begin paying more than long-term bonds. This is believed to reflect the market’s sentiment that long-term views are poor and yields on long-term fixed-income instruments will likely fall further. In 2007 we experienced an inverted yield curve environment that went to proceed a recession and a significant decline in the markets. The 2-yr Treasury yield closed at 1.53% down .02 & the 10-yr yield finished lower at 1.49% down .06.

Today, the markets followed the downward trajectory and inversion of the yield curve and not consumer confidence numbers and declined across the board. The S&P 500 lost 9.22 points or .32% to end the session at 2,869.16. The Dow lost 120.93 points closing at 25,777.90 down .47%.  The tech-heavy Nasdaq closed at 7,826.95 down .34% or 26.79 points. The Russell 2000, the small-cap stock market index representing the bottom 2,000 stocks in the Russell 3000 Index,  closed at 1,456.04 down 19.96 points or 1.35%. 

The U.S. Dollar Index closed at 98.07 up .4%.

Volatility bets closed higher today with the markets decline.   The CBOE Volatility Index (VIX) closed at $20.31 share up 5.12% or $.99/share and traded between $18.49 and $21.04. The 2x leveraged ETF TVIX  closed at $20.19/share up 3.59% or $.70/share and traded between $18.73 and $21.69 today.

Energy

The energy sector was off .6% today as oil prices rose 2.4% closing at $54.90/bb. Dow 30 energy participants Chevron (CVX) moved higher by .08% closing at $115.83/share & Exxon (XOM) closed lower by .97% closing at $67.19/share.  Occidental Petroleum (OXY) closed at $42.35/share up .52% after their recent sale of $13 billion of debt to fund their Anadarko Purchase. 

Metals & Mining

Gold prices moved higher to close at $1534.69/oz. Silver jumped and closed at $17.70/oz. Hecla Mining Company (HL) closed at $1.78/share up a whopping 7.23%. 

Healthcare

The S&P 500 healthcare sector closed at 1029.73 down .55%. UnitedHealth (UNH) closed down 3.53% closing at $222.93/share, Walgreens Boots Alliance (WBA) closed at $49.45/share down 1.18% & Cigna (CI) lost 4.34% closing at $146.27/share post their recent Q2 earnings beat.

INVO Bioscience, Inc. (IVOB) ended the day at $.30/share as 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 lower down .91% closing at $102.22. The 52-wk range is $89.01 – $122.97.

Plus Therapeutics (PSTV) closed up a monster gain of 44.17% or $4.58/share to close at $14.95 today. Plus is a clinical stage pharmaceutical company based in Austin Tx and was formerly named Cytori Therapeutics.

Atossa Genetics (ATOS),  a Seattle-based biotech firm developing novel therapeutics and delivery methods to treat breast cancer and other breast conditions closed at $2.02/share. The average daily trading volume is 418,834 shares per day and reported Q2 financial results & company update today. Recently, Atossa also announced that recently the online launch of company CEO Steven Quay’s Tedx UofW Talk, “How to Be Smart When You’re Dense: Preventing Breast Cancer by 2030.” The talk has been posted online at https://www.youtube.com/watch?v=hK4PlbYE_5M&list=PLsRNoUx8w3rNCo4uCVXiNDFZLiKrIOQ1J&index=5 and can also be accessed via the company’s website at www.atossagenetics.com  and has received over 100,000 views to dateIn the Tedx UofW talk, Steven Quay, M.D., Ph.D., Atossa’s Chief Executive Officer outlines the journey of Atossa Genetics in identifying improved ways to identify women at high risk of breast cancer, using mammography to identify dense breast tissue. Dr. Quay also details his experience with triumph, failure, and perseverance while trying to prevent one of the world’s most common diseases: breast cancer. He emphasizes the need for unshaken efforts to solve such complex problems and ways that he and his team are doing so in breast cancer research. Also, recently Atossa is developing a new proprietary modified-release oral tablet form of its Endoxifen, which is the form of the drug that the company intends for future clinical studies and commercialization. This is the next generation of oral Endoxifen following the successful clinical studies of the capsule form of the company’s oral Endoxifen. A patent application covering the new table has also been filed with the U.S. Patent and Trademark Office. As part of the development of this new oral tablet, Atossa has commenced a Phase 1 study in Australia to ascertain the pharmacokinetics of the tablet. The study is randomized, double-blinded and placebo-controlled with both single and multiple-doses in 2 groups with a total of 24 healthy female volunteers who will be dosed for 14 days. Atossa’s oral Endoxifen capsule, which has been used in previous clinical studies, will serve as the comparator. The first group of the study has now been enrolled and dosed. Steven C. Quay, Ph.D., M.D., CEO, and president of Atossa, commented: “We are excited to take this next step in our oral Endoxifen product development. Based on the abundance of information from our previous clinical studies, we strongly believe in the potential efficacy of oral dosing and intend for this modified-release tablet to be the commercial form of our oral Endoxifen. 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. This new study builds on the success of our Phase 1 studies of the oral capsule and topical forms of our Endoxifen, our recent successful Phase 2 study of topical Endoxifen, which demonstrated significant efficacy in reducing breast density, and our single-patient compassionate use study of oral Endoxifen. Following the completion of this Phase 1 trial, we will continue to use this proprietary modified-release formulation for future clinical studies — including a Phase 2 trial that we have already indicated is in development — and ultimately regulatory approval. We look forward to completing the study in the next quarter.”

Stoke Therapeutics, Inc. (Nasdaq: STOK), a biotechnology company that is pioneering a new way to treat the underlying cause of genetic diseases by precisely upregulating protein expression,  announced recently that the enrollment of the first patient in an observational study of children and adolescents ages 2 to 18 with Dravet syndrome. Dravet syndrome is a severe and progressive genetic epilepsy characterized by frequent, prolonged and refractory seizures, beginning within the first year of life. The effects of the disease go beyond seizures and often include cognitive regression or developmental stagnation, ataxia, speech impairment, and sleep disturbances. STOK shares closed at $33.16/share down 5.34% on 198,716 shares of trading. 

Consumer Staples and Discretionary

Walmart (WMT) closed at $112.42/share up .38% after their recent earnings beat and positive guidance.

Disney (DIS) closed at $134.49 down .09% after recently revealing that it will launch its new streaming service Disney+ in Canada & Netherlands on November 12th and then in Australia and New Zealand the next day.

The Home Depot (HD) closed at $218.21/share off .20%.

Target (TGT) closed at $104.77/share down .07% after beating earnings estimates recently.

Boeing (BA) closed at $354.73 down 1.20%. Reports recently surfaced that the company is planning to increase the production of the 737 to 52/mo in February 2019 if they get the sign off from regulators that allow the commercial return of the troubled 737 MAX.

Financials

JPMorgan Chase & Co. (JPM) closed at $105.74/share down 1.06%.

Goldman Sachs (GS) closed at $198.07/share down .79%.

Economy

On Monday we received the durable goods orders report which moved up 2.1%.  Excluding transportation, the durable goods orders report went down .4%.

Tuesday, the Conference Board’s Consumer Confidence Index for August came in at 135.1 confirming a relatively strong consumer confidence position in the US. The FHFA Housing Price Index report for June moved up .2%. The S&P Case-Shiller Home Price Index for June also moved higher by 2.1%.

Day or Short Term Trading Update

Last Thursday’s buy of Bloom Energy ( BE) at $5.06/share and $4.99/share paid off as it surged to $5.70 about a 14% move. We were seeking a swing back up to at least the high $5’s after its recent beat down and we got it.

We identified San Jose, CA’s Zscaler (ZS), a cloud-based web security provider, as a bounce play after it got slammed earlier this week after being downgraded and closed down at $70.80. ZS popped then to $74.51/share for an approximate 5% gain.

The Hain Celestial Group (HAIN) was also identified as another bounce play. HAIN shares closed trading at $18.36/share Wednesday after a recent analyst downgrade and a simultaneous price drop from the $22 level that seemed to be triggered by fears surrounding The Brexit issue and timeline. Today shares rose to an intraday high of $18.99 and then closed at $18.91 for 3% move.

We did not add anything in this department today.

Vista Partners LLC (”Vista”) is a California Registered Investment Advisor based in San Francisco. Vista delivers timely and relevant insights via the website: www.vistapglobal.com with daily stories, weekly market updates, monthly macroeconomic newsletters, podcasts, & Vista’s proprietary equity and market research to help you stay informed and stay competitive. Vista’s mission is to invest partner capital while arming investors with a comprehensive global financial perspective across all market sectors. Vista also seeks to provide select issuers with actionable advice regarding fundamental development, corporate governance, and capital market directives.

Stay Informed! Stay Competitive! Sign Up to receive FREE email updates here!



YOUR GUIDE TO STAYING INFORMED IN THE MARKETS

Subscribe for FREE Email Updates & Access To EXCLUSIVE Research!

Connect with us