All To Do About Nothing In The Broad Markets This Week

It was an overall “All To Do About Nothing” kind of week when it came down to the overall results in the broad markets. Only the NASDAQ pushed significantly higher closing at 11,671.56 up .8%. The markets seemed to be “knocked off” center  a bit with the negative news with regard to the vaccine & treatment trial pauses in the fight against the coronavirus epidemic that surfaced from bell weather healthcare companies Johnson & Johnson (JNJ) ($148.10/share) & Eli Lilly (LLY) ($146.13/share.)  Pfizer (PFE) also refuted reports on Friday that they might try to file for emergency use authorization for its COVID-19 vaccine by the end of November. Also, as we all continue to push back to work, school, etc., reports confirmed that worldwide coronavirus cases have now climbed to 39.1M with 1.1 million deaths while the US alone now has reportedly seen 8.04M cases with 218k american deaths.

The presidential elections also presented its own strangle hold on investors minds again this week as we step closer to Nov. 4th. The worries and the uncertainties continue to swell around the issues of a possible change or a continuation of power and philosophy while neither seem that attractive alternatives. We also went another week without another fiscal stimulus package as politicians continue to squabble and position that added its on form of uncertainty and anxiety.

The current earnings season did not help the positive cause as it moved forward again this week without much excitement. A few large financial institutions and a few others presented results that confirmed a quarterly beat in some cases, but all seemed to be cautious with their outlook(s). 

On the macroeconomic side of the coin, the schedule produced a mix of reports as follows: On Monday, we did not receive any significant reports. On Tuesday, we received the Total CPI & the core CPI which were both up by .2% month/month in September. The NFIB Small Business Optimism Index report confirmed a rise to 104 in September. On Wednesday, the Producer Price Index report for final demand confirmed a rise by .4% month/month. The index for final demand also rose .4%. The weekly MBA Mortgage Applications Index report dropped .7%. On Thursday, we received the Initial claims report for the week ending October 10 rose by 53k to 898k while Continuing claims for the week ending October 3 dropped by 1.165M to 10.018M. The Philadelphia Fed Index jumped to 32.3 in October more than doubling the results in September. The Empire State Manufacturing Survey for October dropped to 10.5. Import prices rose .3% in September & export prices also rose .6% in September. On Friday, the Total retail sales report confirmed a rise of 1.9% month/month in September. On a year/year basis, total retail sales moved up 5.4%. Industrial production decreased .6% month/month in September while total capacity utilization of 71.5%. The preliminary University of Michigan’s Index of Consumer Sentiment for October came in at 81.2. The Treasury Budget report confirmed a $200.1B deficit in August.

MARKET RESULTS & MARKET LEADERS

Only 5 sectors ended in the green this week with the industrials leading the pack rising 1.1%.

The Russell 2000, which led all indices the last two weeks, closed at 1,633.81 dropping .2% week over week, and now is down 2.1% YTD. 

The tech-heavy Nasdaq Composite rose .8% week-over-week to close at 11,671.56 and is now up a healthy 30.1% YTD. The highly weighted FAANG’s helped the Nasdaq’s cause as usual and ended as follows:  Facebook (FB) closed at $265.93/share, -.79% Friday ($264.45/share a week ago), Apple (AAPL) closed down 1.4% on Friday at $119.02/share and up from $116.97/share a week ago. Amazon (AMZN) closed at $3,272.71/share, -1.98% Friday ($3,286.65/share a week ago), Netflix (NFLX) closed at $530.79/share, -2.06% Friday, ($539.44/share a week ago), & Alphabet (GOOG) closed at $1,573.01/share, +.89% Friday, ($1,451.22/share a week ago.)

The Dow ended the week at 28,606.3 up .1% and is now up .2% YTD. Around the Dow 30, Johnson & Johnson (JNJ) closed at $148.10/share down from last week’s close of $150.97. Shares of Coca-Cola (KO) closed at $50.03/share slightly down from last Friday’s close of $50.81/share. Shares of Disney (DIS) closed at $126.81/share up from last Friday’s close of $124.98/share.Shares of Nike (NKE) closed at $128/share down from $130.98/share last Friday.

Shares of Deere (DE) charged forward again this week closing at $240.06/share up from last week’s close of $234.81/share or nearly 30 points the last two weeks. Pharmaceutical giant Merck (MRK) closed at $79.83/share down slightly from last Friday’s close of $80.36/share, energy giant Chevron (CVX) closed at $72.89 down from last Friday’s close of $74/share, Caterpillar (CAT) closed at $168.75/share approx. 10 points up from last Friday’s close of $158.94/share while Walmart (WMT) closed at $144.71/share up from last Friday’s close of $142.78/share. Shares of Microsoft (MSFT) closed at $219.661/share up from last Friday’s close of $215.81/share, Salesforce (CRM) closed at $258.55 down from $265.98 last Friday & Boeing (BA) closed $167.35 almost in line with last Friday’s close of $167.33/share. On Friday Boeing’s 737 Max was deemed to be safe again by a European regulator. 

Around the financials sector, we saw the shares of Goldman Sachs (GS) close trading at $206.21/share down from last Friday’s close of $207.54/share after reporting better than expected earnings this week, but also offereing cautious concern regarding the economy. American Express (AXP) closed at $104.91/share down from the $106.34/share close last Friday, Visa (V) closed trading at $200.26/share lower from the $206.26/share last Friday & shares of Morgan Stanley (MS) closed at $51.85/share up from last Friday’s close of $48.83/share. JPMorgan Chase (JPM) ($101.51/share) & Citigroup (C) ($43.19/share) also reported their earnings this week to a less than fanfare reception. 

The S&P 500 closed at 3.483.81 gaining .2% wk/wk and is back up 7.8% YTD. 

Elon Musk’s Tesla (TSLA) closed at $439.67/share up from $433.95/share last Friday.  Chinese EV company Nio Limited (NIO) has a great week climbing to an all-time new high of $29.40 prior to closing at $28.48/share up 1.46% on Friday.

COMMODITY MOVES

Gold prices closed at $1,899/oz. down from $1,930/0z. last Friday & silver prices closed at $24.26/oz. down from $25.29/oz. last Friday. North American silver and gold producer Hecla Mining Company (HL) ended the week at $5.30/share down from last Friday’s close of $5.53/share after recently establishing a new 52-week high of $6.79. Recently, Hecla announced their production results and cash position at the end of Q3. Phillips S. Baker, Jr., President and CEO go Hecla stated, “Hecla’s strong operating performance was from increasing silver production at Greens Creek and Lucky Friday and managing COVID-19 at all the mines. This operating performance combined with higher silver prices allowed us to close the quarter with $97 million of cash and cash equivalents while fully repaying our revolving credit facility. Given our free cash flow generation, we expect to spend about $5 million more in exploration, and based on our realized silver price for the quarter being above $25, we expect the silver-linked dividend to be triggered.” President and CEO Phillips S. Baker, Jr.also recently delivered a presentation titled“Hecla – A Uniquely Scarce Investment”at the Tribe Youtube Channel.

Oil prices ended at $40.85/bbl up .5%. Midstream player, Enterprise Products Partners (EPD), closed trading at $17.21/share up from $17.01/share last Friday and currently sports at an attractive $1.78/share dividend or 10.81%. USA Corporation Partners, LP. (USAC), one of the nation’s largest independent providers of natural gas compression services, closed at $10.72/share basically even from the $10.73/share close last Friday and currently sports a juicy $2.10/share (19%) dividend.

MONEY UPDATE

The U.S. Dollar Index weakened to end the week at 93.06 down .9% again from 93.84 last week.

The 2-yr Treasury yield closed up 3 basis points w/w closing at .16%, the 10-yr yield rose 8 basis points ending at .78 while the 30-yr yield ended at 1.576% up from 1.488% last Friday.

NEXT WEEK

We will be back with another full week of trading even though Monday is Columbus Day. Banks will be closed on Monday.

NEXT WEEK’S KEY MACROECONOMIC DATA

The housing data report and the preliminary October Purchasing Managers’ Index report.

We will also have the following “stocks in view” throughout the week:

STOCKS IN VIEW NEXT WEEK

• Shares of Atossa Therapeutics (ATOS) closed at $2.11/share slightly down from $2.33 last Friday. 

• • Atossa Therapeutics is 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.

  • On October 13, Atossa’s CEO and CFO presented at the Tribe Public Presentation & Q&A event titled “Atossa Therapeutics: Tackling our Greatest Health Challenges – COVID-19 and Breast Cancer” which now can be viewed at the Tribe Public You Tube Channel.

• • Recently, Atossa announced a positive interim safety assessment from the second cohort of healthy participants in their Phase 1 clinical study using Atossa’s proprietary drug candidate AT-301 administered by nasal spray. This second group of eight participants received a single escalated dose of either AT-301A (placebo) or AT-301B (active drug). The blinded, positive assessment by the safety committee allows the study to now enroll the next cohort, which will be the third of a total of four cohorts and the first of two multi-dose, placebo-controlled cohorts. The ongoing Phase 1 study is a double-blinded, randomized, and placebo-controlled safety study of AT-301 nasal spray in 32 healthy adult subjects divided into two study groups. Part A consists of two single-dose cohorts receiving either active therapy, AT-301B, or the placebo comparator AT-301A at two different doses. Part B is a multiple-dose arm with cohorts receiving either AT-301A or AT-301B for 14 days at two different doses. The primary objective of the study is to evaluate the safety and tolerability of single and multiple doses of AT-301 administered via nasal instillation to healthy volunteers. Secondary objectives are to assess the incidence and severity of local irritation and bronchospasm following administration of AT-301 via nasal instillation. The study is being conducted in Australia. READ THE COMPLETE STORY!

• • The Maxim Group’s Analyst Jason McCarthy, Ph.D. updated his research on Atossa Therapeutics stating “Factoring in COVID-19 Candidates, awaiting HOPE Study Initiation as Pandemic Continues – Raising His Price Target to $8 from $4. 

• • Ascendiant Capital Markets’ Analyst Edward Woo, CFA initiated coverage recently with a BUY Rating and a $7.00 Target.

• • Dr. Steven Quay MD, Ph.D., Atossa’s founder, and CEO, recently published the following book “Stay Safe: A Physician’s Guide to Keep You and Your Family Healthy During the Pandemic and Beyond,” in paperback and eBook format on his website, www.DrQuay.com. Proceeds from the book will go to military veterans performing COVID-19 relief work in their communities. You may order it here.

• Shares of INVO Bioscience (INVO) closed at $4.10/share up from the $3.891/share close last Friday.

• • INVO’s mission is to increase access to care and expand infertility treatment across the globe with a goal of improving patient affordability and industry capacity. Industry forecasts suggest that only 1% to 2% of the estimated 150 million infertile couples worldwide are currently being treated which presents and interesting opportunity. 

• • INVO recently announced a new joint venture as it has teamed up with Dr. Francisco Arredondo, MD, a respected and experienced board certified reproductive endocrinologist, and Dr. Ramiro Ramirez, MD, a physician and owner of several successful enterprises in Mexico, to establish a joint venture through its wholly-owned subsidiary INVO Centers, LLC, a Delaware limited liability company (“INVO Centers”), focusing on developing the Mexico market for INVOcell. The new jointly-owned operation, named Positib Fertility, S.A. de C.V. (“Positib Fertility”), is a Mexico registered company that will focus on establishing fertility centers dedicated to offering INVOcell, with the initial center to be located in the city of Monterrey, Mexico.

• • Recently, INVO Bioscience, Inc. (INVO), the developers of INVOcell®, the world’s only in vivo Intravaginal Culture System, announced the appointment of two seasoned executives, Barbara Ryan and Matthew Szot, to its board of directors, effective immediately. To make way for their appointments, Kathleen Karloff and Michael Campbell have both agreed to voluntarily step down from their board positions to assist the company in achieving an independent board majority. Mr. Campbell will remain as Chief Operating Officer and Vice President of Business Development, while Ms. Karloff intends to continue to advise the board and assist the operating team on a go-forward basis. Ms. Ryan founded Barbara Ryan Advisors, a capital markets and communications firm, in 2012 following a more than 30-year career on Wall Street as a sell-side research analyst covering the US Large Cap Pharmaceutical Industry. Previously, Ms. Ryan was a Managing Director at Deutsche Bank/Alex Brown and Head of the company’s Pharmaceutical Research Team for 19 years and began her research career covering the Pharmaceutical industry at Bear Stearns in 1982. Ms. Ryan has deep experience in equity and debt financings, valuation, SEC reporting, financial analysis, and corporate strategy across a broad range of life sciences companies. During Ms. Ryan’s career as an analyst, in addition to covering the large-cap pharmaceutical companies, Barbara also covered the drug wholesalers and PBMs and was the lead analyst on many high-profile IPO’s including Express Scripts, PSSI, Henry Schein, and Flamel Technologies. Ms. Ryan has extensive global buy-side, sell-side and financial media relationships, and has provided support and counsel on several of the highest-profile deals in the biopharma industry, including Shire/Abbvie, Shire/Baxalta, and Allergan/Valeant. Barbara led the IR/PR programs for Radius Health, the best performing IPO of 2014, for 4 years, Eloxx Pharmaceuticals for the past two years, and served on the Executive Team at both companies. Ms. Ryan has provided strategic communications counsel for Cardinal Health, Purdue, Zoetis, Radius Health, Eloxx Pharmaceuticals, Agenus, Centrexion, Esperion, ContraFect, Relypsa, Shire, Allergan, and Perrigo. Ms. Ryan’s opinions and expertise are widely sought; she is frequently quoted in the press and appears on CNBC. Ms. Ryan currently serves on Pharmaceutical Executive’s Editorial Advisory Board, the Executive Advisory Board for the Prix Galien Foundation is a member of the Life Sciences Council of Springboard Enterprises and is a member of the Board of Directors of Gilda’s Club NYC, and a Faculty member at the GLG Institute. Ms. Ryan Chaired the Board of Villa Maria School, a school for children with learning disabilities, for 8 years. Ms. Ryan is the Founder of Fabulous Pharma Females, a non-profit dedicated to the advancement of women in the biopharmaceutical industry.

• North American silver and gold producer Hecla Mining Company (HL) ended the week at $5.30 down from $5.55/share last Friday.

• • Recently, Hecla announced their production results and cash position at the end of Q3 this week. Phillips S. Baker, Jr., President and CEO go Hecla stated, “Hecla’s strong operating performance was from increasing silver production at Greens Creek and Lucky Friday and managing COVID-19 at all the mines. This operating performance combined with higher silver prices allowed us to close the quarter with $97 million of cash and cash equivalents while fully repaying our revolving credit facility. Given our free cash flow generation, we expect to spend about $5 million more in exploration, and based on our realized silver price for the quarter being above $25, we expect the silver-linked dividend to be triggered.”

• • A Presentation & Q&A event video with North American Silver & Gold Producer Hecla Mining Company’s (NYSE: HL) President and CEO Phillips S. Baker, Jr. titled “Hecla – A Uniquely Scarce Investment”  is available to view at the Tribe Youtube Channel.

• Shares of Fate Therapeutics (FATE) closed at $48.64/share up significantly from $48.01 last Friday after establishing a new all-time 52-wk high of $51.10 this week.

• • Fate is a clinical-stage biopharmaceutical company dedicated to the development of programmed cellular immunotherapies for cancer and immune disorders.

• • Aug. 19, Fate announced that Edward Dulac has been appointed Chief Financial Officer. Mr. Dulac comes to the Company from Celgene Corporation, where he most recently served as Vice President, Business Development & Strategy, and brings an extensive array of biopharmaceutical experience having served for over 20 years in positions in finance, business development, and product portfolio strategy.

• • On Aug. 5, Fate Reported Second Quarter 2020 Financial Results and Highlights Operational Progress ending the quarter with $533 Million in Cash & Short-term Investments. Scott Wolchko, President and Chief Executive Officer of Fate Therapeutics stated, “Early clinical data from our FT596 program are very encouraging, as we observed a partial response in a heavily-pretreated patient with refractory diffuse large B-cell lymphoma at the first dose level without any reported events of cytokine release syndrome, neurotoxicity or graft-versus-host disease. Additionally, the safety, tolerability, and immunogenicity data across our off-the-shelf NK cell programs continue to suggest that multiple doses of iPSC-derived NK cells can be administered to a patient without matching. We continue to be pleased with our pace of innovation, where the recent clearances of our IND applications by the FDA for FT538, the first-ever CRISPR-edited iPSC-derived cell therapy, and for FT819, the first-ever iPSC-derived CAR T-cell therapy, continue to demonstrate our unique ability to rapidly bring multiplexed engineered, off-the-shelf NK cell and T-cell cancer immunotherapies to patients. In addition, we successfully launched our Janssen collaboration with strong momentum, bringing together Janssen’s proprietary tumor-targeting antigen binders and our industry-leading iPSC product platform to develop novel off-the-shelf CAR NK and CAR T-cell immunotherapies for hematologic malignancies and solid tumors.”

• Shares of NeuBase Therapeutics (NBSE) closed trading at $8.82/share up from $8.40/share last Friday.  

• • NeuBase is developing the next generation of gene silencing therapies with its flexible, highly specific synthetic antisense oligonucleotides. The proprietary NeuBase peptide-nucleic acid (PNA) antisense oligonucleotide (PATrOL™) platform allows for the rapid development of targeted drugs, increasing the treatment opportunities for the hundreds of millions of people affected by rare genetic diseases, including those that can only be treated through accessing of secondary RNA structures. Using PATrOL technology, NeuBase aims to first tackle rare, genetic neurological disorders. NeuBase is continuing its progress towards developing treatment candidates in Huntington’s Disease (HD) and Myotonic Dystrophy (DM1.)

• • NeuBase’s CEO Dietrich A. Stephan, Ph.D. will be presenting an an upcoming October 28th Tribe Public Webinar Event titled “Manufacturing Heat Seeking Missiles Against Misbehaving Genes.” You may register for FREE at NeuBase.TribePublic.com.

• • This week, NeuBase announced the addition of Peter Nielsen, Ph.D. to its scientific advisory board. Dr. Nielsen, the primary inventor of peptide nucleic acid (PNA) technology, brings extensive experience in genetic medicine to NeuBase as the Company optimizes its PATrOL™ therapies and moves them towards the clinic. Dr. Peter Nielsen is a leading expert in gene targeting, RNA interference and chemical replication and translation and was one of the inventors of PNAs in 1991. He is currently a professor at the University of Copenhagen where his lab focuses on PNAs in regard to drug discovery, gene targeting, antisense principles, cellular and in vivo delivery and administration of biopharmaceuticals. He is the co-author of more than 400 scientific papers and reviews as well as over 20 patents and patent applications, and he serves on the advisory board of four scientific journals. In addition to his esteemed academic career, Dr. Nielsen is the co-founder of two biotech companies in Denmark and is a member of EMBO and the Danish Academy of Technical Sciences. He received his Ph.D. in 1980 from University of Copenhagen.

• • RBC Capital Markets recently initiated coverage of NBSE today with an Outperform, Speculative Risk rating & a $16 price target. 

• Shares of Chinook Therapeutics, Inc. (NASDAQ: KDNY) closed at $16.73/share up from $16.33/share last Friday after rising to a new 52-week high of $19/share.

• • Recently Chinook Therapeutics, Inc. (NASDAQ: KDNY), a clinical-stage biotechnology company focused on the discovery, development and commercialization of precision medicines for kidney diseases, announced the closing of its merger with Aduro Biotech, Inc. and $115 million private placement financing. The combined company, now known as Chinook Therapeutics, commenced trading October 6, 2020 on the Nasdaq Global Select Market under the trading symbol “KDNY.” As previously announced, the $115 million private placement financing includes participation from new investors EcoR1 Capital, OrbiMed Advisors, funds managed by Rock Springs Capital, Fidelity Management and Research Company LLC, Avidity Partners, Surveyor Capital (a Citadel company), Ally Bridge Group, Monashee Investment Management LLC, Northleaf Capital Partners, Janus Henderson Investors, Sphera Biotech and other top-tier healthcare investors. As part of the financing, Chinook’s existing investors, Versant Ventures, Apple Tree Partners and Samsara BioCapital, purchased $25 million in Chinook common stock on the same terms as the new investors. Effective as of the closing of the merger, Chinook has over $275 million in operating capital to advance its kidney disease programs.

• We continue to like clean hydrogen solution provider Plug Power (PLUG) which closed at $16.27 of from the 18.43/share close last Friday. Shares of PLUG are up significantly since we brought PLUG to your attention after they closed the $300M equity offering at $10.25 over the last couple of months. 

Thanks again for your attention this week. Please continue to share your thoughts, questions, & ideas as we move forward. 

In the meantime, please enjoy the balance of the weekly newsletter’s videos, quotes, updates. 

I will leave you with an insightful quote to help form your investment thesis this week:

“Thousands of experts study overbought indicators, head-and-shoulder patterns, put-call ratios, the Fed’s policy on money supply…and they can’t predict markets with any useful consistency, any more than the gizzard squeezers could tell the Roman emperors when the Huns would attack.” – Peter Lynch