“To Trust or Antitrust” Vista Partners Daily Market Recap 6/3/19

By John Heerdink LinkedIn

At least the world order these days is consistent in providing the markets with enough reasons to be concerned and/or continue to fuel the sell-off. Today the bearish theme for the tape was fed another serving from the US-China trade wars.  This time the entree was a slice of Chinese negative pie via a white paper that pointed fingers at the US government and its concern for global growth. The paper highlighted the following three points: I. Economic and trade friction provoked by the US damages the interests of both countries and of the wider world, II. The US has backtracked on its commitments in the China-US economic and trade consultations, & III. China is committed to credible consultations based on equality and mutual benefit. It is an interesting read and yet another reason to believe that the trade wars will persist for some time as these two sides duke it out on the world stage.

As if the trade wars were not enough to bring fear up to a nice level in the markets we were also hit with the fact that the markets’ beloved giant tech companies may now be reviewed by the Department of Justice and/or Federal Trade Commission regarding antitrust violations. The tech companies that have been highlighted for theses actions all traded down significantly. Amazon (AMZN) slid 4.6%,  Alphabet (GOOG) dropped 6.1%, Apple (AAPL) lost 1% & Facebook (FB) dropped the most losing 7.5%. The balance of the tech sector was under pressure again for the most part. Intel (INTC) dropped 1.32% closing at $43.46/share. Shares of Microsoft (MSFT) closed lower at $119.84 off a solid 3.10%.  Surprisingly, Uber Technologies (UBER), the ride-sharing company closed higher at $41.25 up 2.08% as it rose higher at the end of trading today. Investors continue to react positively to last week’s earnings report that confirmed that it did not lose as much as expected and their bookings are seeing double-digit increases. Could we see the Uber’s stock head north of its recent IPO price of $45/share for the first time?

A negative statement that contained a silver lining in it also came from  St. Louis Fed President James Bullard who stated that slower economic growth could be sharper than expected due to the trade uncertainty. However, he suggested that a rate cut could be justified this year. Treasury yields fell again. The 2-yr yield ended at 1.83 & the 10-year Treasury note closed down at 2.08%.

The S&P 500 ended the session down 7.6% at 2744.45. The Dow charged back to end the day to be slightly in the green adding 4.74 points up .02% closing at 24,819.78 while the tech-heavy Nasdaq slid 1.61% closing at 7332.99 & the Russell 2000, the small-cap stock market index of the bottom 2,000 stocks,  eeked out a win as it ended up .31% and closed at 1469.98.

The price of gold hit $1,314.33/ounce today. This is the highest price that gold has hit since March 27, 2019.  Hecla Mining (NYSE: HL) which has been under pressure lately jumped 12.98% closing at $1.46. First Majestic Silver (NYSE: AG) closed up 6/09% at $6.45/share.

The US Dollar Index was off another .5% at 97.22 and hs ow dropped .9% in the last two trading sessions.

Oil prices decreased again by .36% &  closed at $53.06/bbl. Dow 30 energy participants Chevron (CVX) closed up at $115.199 or 1.88% & Exxon (XOM) closed down at $71.88 dropping 1.57%.

Volatility was interestingly a bit tighter today. The CBOE Volatility Index (VIX) closed at $18.86 & up .8%. It traded between $18.16 – $19.77. The 2x leverage ETF TVIX also closed higher too at $26.05 up 1.17% and trading between $24.72 and $27.28 today.

Dow 30 components & the world’s leading manufacturer of construction & mining equipment Caterpillar (CAT) closed at $120.65 up .70%.

Pharmaceutical giant Merck & Co, Inc. (MRK) rose to $80.26 up 1.33%.

Entertainment giant Disney (DIS) closed at $132.47 up .33%. See our latest story on Disney: Will Georgia’s Abortion Law “Force” Disney To Stop Filming In The State?

Home Depot (HD) lost .15% closing at $189.57.

Community Health Systems, Inc. (CYH) one of the largest publicly traded hospital companies in the US hit an intraday high of $2.81/share & a low of $2.56 today and closed the day at $2.80 up  5.26% on 3.43 million shares of trading. More insider buying occurred recently as Michael Dinkins bought shares at $3.168/share on 5/28/19 according to the latest Form 4 filed at SEC.gov. Michael Dinkins has served on our Board of Directors since December 2017. Mr. Dinkins has served as president and chief executive officer of Dinkins Financial, a consulting firm that helps small businesses gain access to capital, since October 2017. See our story more details: INSIDER BUYING ALERT: Community Health Systems, Inc. (CYH) Director Michael Dinkins.

The Seattle-based biotech firm developing novel therapeutics and delivery methods to treat breast cancer and other breast conditions Atossa Genetics (ATOS) closed at $2.50/share as traded as high as $2.54. The average daily trading volume is 3.10 million shares per day.  The Maxim’s Group’s biotech analyst, Jason McCarthy, Ph.D., reiterated his ATOS buy rating recently with a $9/share 12-Month Target Price. See his update report which is called “Reports the Quarter, Endoxifen Programs Progressing, Data Updates Expected Over 2019.”

San Diego-based biotech Fate Therapeutics (NASDAQ: FATE) which is dedicated to the development of programmed cellular immunotherapies for cancer and immune disorders closed at $19.46/share on 413,436 shares of trading after establishing a new all-time intraday high last week of $20.65. The 52-week range is $8.64 – $20.65. Guggenheim Securities initiated coverage on FATE last week with a “Buy Rating” and a $25/share price target.

INVO Bioscience, Inc. (IVOB) ended the day at $.3249 and traded 203,028 shares. IVOB is a medical device company, headquartered in Medford, Massachusetts, 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 enables egg fertilization and early embryo development in the woman’s vaginal cavity. IVOB reported progress yesterday after the markets close as it released its Q1 2019 numbers including revenues for Q1 2019 increasing by 82% and gave us a look into the progress expected in Q2 2019. Katie Karloff, Chair and Chief Executive Officer of INVO Bioscience, commented, “We expect 2019 to be a pivotal year in the history of INVO Bioscience.”

Two key economic points came across today as the ISM Manufacturing Index for May checked in at 52.1% which is lower than the 52.8% in April further indicating slower growth in manufacturing. Total construction spending came in unchanged for April.

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.

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