We attended the BIO Investor Forumin San Francisco this week and will provide a brief review of select technologies and companies on Monday. Despite a funding gap for earlier stage companies we believe the life science sector continues to offer good opportunities for investors.
By now you have read every market summary on the big rally yesterday driven by progress on the European debt crisis and 2.5% growth in last quarter’s GDP. However many analysts believe the market move was overdone but in the words of Marty Zweig, “…don’t fight the tape.” There is a lot of fast money on the sidelines. The market is slightly positive for the year and of course if you followed many of our life science picks especially those in biopharmaceuticals you have substantial profits YTD.
Our most recent biotech picks are on track especially those reiterated buys in September. Even the tools and diagnostics sector has come to life and we will review earnings for selected diagnostics stocks. Illumina (ILMN $32) was the big loser of the recent meltdown as revenues missed guidance but the stock has been a good trade over 5 days up 17%.
Significant upside movers on volume in our Rayno universe today are Biomarin (BMRN $35.20) up 5%, Gilead (GILD $2.89) up 1.85%, and Viropharma(VPHM $20.47) up 3.8%. The biotech market overall is up 7% YTD if you invest in ETF’s and more if you bought a laggard fund like Fidelity Select Biotechnology (FBIOX) up 14% YTD,which is finally outperforming ETF’s because of good picks in biopharmaceuticals.
The QQQ another one of our “balancing” picks with many large cap biotech holdings,is still outperforming the IBB by a slim amount and both are up over 7% YTD.
It is a very difficult time to add positions but even with nasty politics ahead with the deficit deal, the market wants to go higher by year end.