Updates-2… 2/6/18 Biotechs Down With Overall Market Over 5 Days 

Closing Prices as of 2/6/18

XBI up 3% at $91.05 down 5.34% over 5 days

IBB up 2% at $109.36 down 7.35% over 5 days

QQQ up 2.65% at $162.31 down 5.04% over 5 days

By now you have read about all the possible reasons why the market is down but really nobody knows and there is no biotech specific news to account for the downdraft. Pundits and analysts have suggested : technical trades with bots feeding off one another; threat of higher interest  rates; comments by Janet Yellen on high valuations; and profit taking because of meteoric swing up in January.

But some veteran investors have said market is over leveraged especially with 2X, 3X ETFs that can be dangerous for aggressive traders.

XBI SPDR S&P Biotech ETF daily Stock Chart


Biotech Sell-Off: Not So Bad If It Can Hold At These Levels

Watch QQQ and XBI: Looking Like Favorites For This Month If Bull Holds

The First Trust  Arca Index FBT Looks Like a New Winner up 42.7 % Over 12 Months

Biotech stocks got hit with a double whammy first from concerns about high prices and disruption in healthcare from reform. But biotech investors made money last year and are still in the green for 2018 even after many stocks reported earnings. Here is the damage summary for the week and YTD:

  • Biotech ETFs: FBT down 4.28%, up 11.67% YTD; IBB down 5%, up 5% YTD; XBI down 4.47%, up 8.27% YTD.
  • Healthcare XLV down 5%, up 5.09% YTD.
  • Powershares QQQ Trust down 3.7%, up 5.68% YTD.
  • Technology SPDR XLK down 3.92%, up 3.96% YTD.
  • The S&P 500 SPY was down 3.88% this week.

So after a severe correction we are still up YTD with all major indices tracking up in the same range but with life science and tech stocks doing better than the market overall.

It is important to track sectors going forward especially after energy took a severe hit on Friday with XLE down 4% and now flat YTD. Industrials also took a hit but are still up 2.39% YTD. Financials we’re down 3% for the week and are up 3.37% YTD. So it this point early in the year I’d be most concerned about energy and would favor technology and financials but we’ll soon see how the rotation goes. Healthcare and biotech look good if M&A keeps going and NASDAQ holds up.

Reviewing individual large cap stocks below we can see many are beating the IBB including our Rayno Top Portfolio picks ABBV, AMGN, BIIB, GILD.

AMGN and BMY look like safe dividend picks for the year whereas CELG cannot get traction fluttering at the $100 level after the uncertainty of the JUNO acquisition. CELG was a new pick at $102. Our best long term pick bluebird bio (BLUE) is still up 11.68% YTD.

Update Wednesday.

Disclosure Long ABBV, AMGN, BMY, CELG, GILD

We will post a financial review of larg caps after all reporting is completed.

Company Ticker Price 2017 Market P/S % Perform % Perform
1/15/2018 Rev$B Cap $B 12 mos YTD 1/15 2018 YTD 2/4
Abbvie ABBV 100.34 27.27 160 5.88 61.86 19.09
Alexion ALXN 122.71 3.47 27.39 7.89 -10.38 -2.88
Amgen AMGN 185.04 23 134.7 5.85 18.5 7.54
Biogen BIIB 335.95 11.84 71 6 18 7.93
Bristol Myers BMY 62.81 19.920.57 102.95 5 11.7 3.59
Celgene CELG 106 12.5 84.8 6.78 -9.77 -4.37
Gilead Sci GILD 79.02 27.48 103.2 3.76 8.14 14.08
Merck MRK 58.66 39.8 160.2 4.02 -5.9 4.07
Regeneron REGN 366.96 5.52 39.21 7.11 0 -7.47
Vertex VRTX 158 2.3 38 16.9 91 10.93
XBI 8.2
IBB 5.03


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