Update-2 …Futures Sink As Trade War Rhetoric Heats Up: China Responds to Trump
- Additional $200B in tariffs on Chinese goods that may get hit with tariffs-See Bloomberg updates.
- China will take countermeasures-strongly opposed US action.
- Nikkei hit hardest down 2.1%.
- China commerce ministry official says US tariff plan hurts WTO system.
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Update-1… Biotech Stocks Mixed on Macro Concerns
FBT up 0.25 to $148.48, IBB down 0.17% to $116.81, XBI down 0.45% to $99.64
Many stocks made nice gains: ABBV up 1.85%, AMGN up 0.78%, CELG up 0.85%.
Mid-Caps had more red than green but some made good gains: ALNY up 1.9%, BLUE up 2.6%,TSRO up 1.68%.
Biogen (BIIB) continued weak down 2.59% to $344.82.
Healthcare a tad better XLV up 0.38% to $86.97
The next major potential pivot point will be Q2 earnings reports next week. Here is the Q1 financial metrics grid for large caps.
Pfizer (PFE) was up 0.73% to $37.43. After hours the Company caved into Trump tweet pressure and rolled back (deferred?) price increases…. “Pfizer shares the President’s concern for patients and commitment to providing affordable access to the medicines they need,” said Ian Read, Chairman and CEO.
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Biotech Rally Buffeted By Drug Pricing Tweet
Trump Tweet Targets Pfizer’s Recent Price Increases
Large Cap Biotechs Gain
The Biogen (BIIB) catalyzed rally has stalled on another tweet on drug pricing from POTUS. You’ll remember in May the market was worried about potential drug policy changes from the Trump Administration but because few details emerged the concerns evaporated and a rally ensued. The tweet target this time was Pfizer (PFE) which got slammed for drug price increases after July 1. Trump has been promising action for lower U.S. drug prices but nothing has materialized as of yet. We are still awaiting”self-regulation” on drug price hikes. Pfizer (PFE) stock was flat for the day at $37.16.
Although large mega cap global drug companies are most affected by drug pricing rhetoric, the sentiment can spill over to large cap biotech in the past.
You know that Trump targeted the Saudis and OPEC on oil prices with tweets recently but if Iran gets cut back supply gets further diminished and prices can move up. WTI crude is now $74.06 at one year highs.
Here are some of the major ETFs with large cap focus, slightly up.
IBB up 0.83% to $116.83
XLV up 0.67% to $86.59
XPH up 1.06% to $44.86
Large cap biotech stocks on our portfolio picks today: AMGN up 1.65%, BIIB off 0.97%, CELG up 1.71%, GILD up 1.9%.
Just the other day we were reading that healthcare was the place to hide from a step-up in the trade wars but we see other news buffeting the sector like this news yesterday on Trump suspending insurance payments.
Disclosure: long ABBV, CELG, FBIOX, GILD other small and mid caps.