Update 8PM EDT

NASDAQ Holds Losses to 0.54%-Futures Stable

Biotech Damage Across the Sector-Rayno Life Science Portfolio Notes

Large Caps off about 2% (FBT), but Gilead (GILD) down only 0.95% and Roche (RHHBY) up 0.28%.

Rayno Biopharma stocks all red down 3-4% with XBI down 3.86%, IBB down 2.2%.

Damage not as severe in Diagnostics and Tools :  Exact Sciences (EXAS), GenomicHealth (GHDX) , Nanostring (NSTG), and Thermo Fisher (TMO) all in the green. Profit taking hits Illumina (ILMN) down 3.4%.

1pm JY 16 from Kimble Charting Solutions:

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NASDAQ and Biotech Sell-Off on Yellen’s Monetary Report

Some found comments by the FED unusual in that equity valuations are not under their covenants but the FED may be trying to draw attention to risk in the broader sense because the corporate bond market can be affected by speculation in small cap stocks.

Profit taking continued in many MoMo small cap biotech stocks after a FED written comment suggested that “equity valuations of smaller firms as well as social media and biotech firms may be stretched….” Over the past week we urged some profit taking in biotech stocks on our focus list as many are up over 50% YTD. Moreover technicals among smaller cap biopharmaceutical firms have weakened as the sector just as the sector overall had recovered from April lows rocketing to within 10% of 2014 highs.

On February 25, 2014 at sector highs we cautioned on the biotech bull market reaching a bubble phase.

Biotech stocks are broadly down with ETFs down about 2% but the more speculative and small cap weighted XBI down 3%. The sell-off was not limited to small caps as many well known “mid-caps” were 3% movers on the downside are : Cubist (CBST), Incyte (INCY), Illumina (ILMN), Pharmacyclics (PCYC) and Seattle Genetics (SGEN).

Update after the close.

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