Drug Stocks with Dividends for Safety and Appreciation

On Monday AM we thought blue chip drug and biotech stocks were poised to rally and we were rewarded. The S&P has come back to early August depressed levels but we have a double bottom in August. Healthcare overall was up 0.53% today compared to 1.3%  for the S&P. Large cap drug stocks look solid and we should mark last Friday as the summer bottom barring any sector news. Amgen (AMGN) is up 5%, Pfizer (PFE) 3%, JNJ up 2% and Abbott (ABT) 2% over 5 days. The broader based XLV healthcare ETF has lagged and the IBB ($92.21) biotech ETF shows a strong bottom in the 87-88 range. The bull market in biotech that began in March 2009 is intact if we look at a basket of stocks including Alexion ($53.51), Biomarin (BMRN $28), Cubist (CBST $32.51)  Regeneron (REGN $56.80), Viropharma (VPHM $18.51). For brave traders, bottom fishing candidates in diagnostics would be: Illumina (ILMN 448.19),Qiagen ($15.28 ) and SeraCare (SRLS $3.42).

Market is Up When Gold Is Down?

Gold ($1751) is in free fall down over $160 in two days and the debate rages on whether this is the end of the gold bull.  But as Yogi once said, “it ain’t over till its over”. The CME helped trash gold by raising margin requirements. Gold bulls point out that even if gold hits $1600 it is within its two year trend and since 2003 gold is up 23% while the S&P was up only 5% plus gold is less volatile.

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