Update 3/25 Mid-Day Trading NAZ Off 1.55% at 4917

“Bubble Talk” Picking Up-Mid Caps Vulnerable

Biotech sector selling picked up today with a dramatic shift in sentiment exacerbated by an overall weak market. Also durable goods fell unexpectedly 1.4% in February indicating weak global growth.Technology was the weakest sector down 1.74% but the resilient healthcare sector was also weak down almost 0.8%. The bellwether XBI was down 4% and now off 4.27% over 5 days after a Friday spike at $244. Biotech has been driven by M&A, new product approvals and revenue growth with a lot of support by media and analysts.Today the Wall Street Journal on page C1 joined the chorus of bubble worries citing excessive valuations and huge gains YTD.

Emerging mid-cap “Immuno-oncology” stocks are hit hard: AGIO BLUE CLDX JUNO KITE ZIOP.

Amgen (AMGN), Gilead (GILD) and Roche (RHHBY) are holding up reasonably well. The XLV is down only 0.47% buoyed by large cap drug stocks.

This correction needs to run its course to wring out speculation from multi-$B market cap emerging biopharmaceuticals stocks with limited clinical data and no revenues.



Update after the close: Selling Picked Up at 3p….. 3/23

Healthcare sector down 0.24%, XLV down 0.28%

XBI down 2%, FBT down 1.89%

Mid Caps down hardest : ALKS 2.95%, CLDX 6%, CLVS 3%, Seattle Genetics 3.09%, Vertex 3.98%

Rayno Dx and Tools in the green: AMRI, QDEL, TMO

Watch the technicals as we are overbought.


Profit Taking Hits Biopharmaceutical Stocks

There is a bit of a sell-off today in the biotech sector. The sector hit new highs last week with “blow-off” type stock action after the Biogen Idec move on their Alzheimer Drug Phase I results. Also Biogen shares were downgraded today by Stifel. Gilead Sciences (GILD) shares were weak on news of a patient death using Hep-C treatments ¬†Sovaldi and Harmoni, caused by a slowing heart beat in a patient taking amiodarone for irregular heartbeats. Vertex Pharmaceuticals (VRTX) was off 4% on disappointing data for their cystic fibrosis drug.

All three of these stocks are in the Rayno Biopharmaceuticals Portfolio.

The red hot, momentum driven immune-oncology group also sold off: AGIO BLUE JUNO KITE ZIOP.

There was a lot of “bubble talk” about biotech stocks last week and the huge 23% move up in 2015 brought in the sellers. The sell-off is broad with few winners.

Money apparently moved out of healthcare stocks and into other sectors with basic materials leading.



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