Crazy Stealth Biotech Rally in Small Caps-Who Gave the Buy Signal?
- NASDAQ up 0.73%, XLV up 0.70 %. MedTech and Dx/Tools also green.
- IWM up 1.88% to $153.63 up 14% YTD, lagging XBI up 20.7% YTD.
- Volatile market for traders in small caps.
It was a green screen for small caps and the more speculative biopharma stocks. Many of the biggest smaller cap movers were laggards in 2019. The XBI tracked the rally up 2.57% but below where we last sold the stocks at $86. Can’t find the news that said it’s OK to buy the sector but look at the rally:
- Gene Therapy stocks gained with a green screen. Some of the smaller laggards were up big: SGMO, SLDB. Two of our holdings soared: CRSP up 3.28%,MGTX up 6.25%; other winners were BLUE and EDIT.
- Mid-caps were active and green.Among the Big 3% + winners were: AGIO IMMU, MRNA,NKTR,NVCR, RARE, RETA, XNCR. These stocks are near 52week highs:ACAD ARRY ARNA INCY MRTX NVCR RGEN.
- Large Caps were flattish but laggard REGN gained 1.83%, IBB up 1.38%. ABBV was up for a second day 2.94% to $70 after being hit hard Tuesday to a low near $65 by the merger with Allergan (AGN).
One Day Wonders?
The big moves in some of the more speculative stocks shows how difficult stock picking can be unless you are “in the know”. Every day I see stocks on the WSJ “gainers” or active list that I did not know, Here are some random small caps with unusual volatility in 2019:
AKBA AXGT ARCT ARQL AVDR BLCM IOVA KRYS MRNA MRNS OCUL PTCT RCUS RETA ZIOP etc etc
By now you know that the IPO market has been strong and the window remains open for small cap financing. Recent data from Renaissance Capital shows a robust IPO Market for techs and biotech’s. The Renaissance ETF (IPO) was up 1.69% today to $32.34.and 36.8% YTD
- 62 IPOs raising $25B, a five year rtecord. Biggest Q since 2000.
- Broad sector activity with tech and biotech.
- Healthcare sector gained 18% with 24 days and most active.
Disclosure long ABBV, CRSP MGTX.
Update mid morning Friday….