Update-2 10/21 … Market up on softer FED perception, who knows? But if treasury yields go down stocks usually go up. A strong biotech tape today with many movers.
- Added to life science positions in ILMN,MRNA (upgraded by SVB from Underperform to Market perform).
- XBI up 1.6% to $77 still lagging. IBB up 2.82%.
- Pacific Biosciences (PACB) up 16% on new product utilizing Single Cell Gene Expression Technology.
- Biopharmas strong: ABBV, BMY,GILD, LLY, MRK.
Update-1 10/18…Broad rally continues for second day in seesaw session with ~1% gains. Healthcare and biotech mixed with XLV up 0.56% XBI up 0.47%,MedTech looking better with IHI up 0.94% at $49 handle. JNJ flattish on earnings, sales growth of 1.9% to $23.8B. Pharma 9.2% and MedTech 8.1% sales growth negatively iimpacted by currency.
- Pundits and strategists see short term bear market rally.Technicals holding downside bottom above S&P 3500 now at 3719.
- LLY,MRK and VRTX remain strong.
- Quidel recovering after pre-release.
Steady As She Goes With Healthcare Stocks
- Healthcare Outperformed During a Nasty Volatile Week Up 0.8%.
- Favorable seasonality lies ahead for Q4 with caveat of Q3 earnings reports.
- Large cap biopharma is favored with earnings in coming weeks.
We reviewed our model portfolio over the weekend and were surprised to see how steady healthcare stocks were through September.Large cap biopharma continued to hold through last weeks and LLY, MRK and REGN showed gains.Merck was upgraded. All are up substantially YTD.
Biotech was more choppy with the XBI hit by interest rate worries and concerns about limited capital available for small caps.XBI is up 3% this am. MedTech and devices (IHI) continue to lag but doing well today.
UNH earnings were strong last week and the stock is up over 1% this am.
This morning’s strong rally was deemed by some as a relief rally after the nasty September. This is a good time to rebalance and look at large cap trades in other sectors .
|Stock/ETF||Ticker||Price||Wgt||Price||Price||1 year||Price||YTD||30d||P 10/15|
|10/25||%||12/31||% Perf||12/31/21||% Perf||9/23/22||%Perf||
|iShares NAZ Bio||IBB*||136||15||151.5||25.7||152.62||-31.14||115.32||-24.44||-8.02||119.58|
|iShares Russell 2k||IWM||163||5||196.4||18.3||222.45||-20.36||167.31||-24.79||-12.38||166.81|
|SPDR S&P Bio||XBI||117||10||140.8||48||111.96||-38.67||76.65||-31.54||-12.65||77.82|
|T.Rowe Hlth Sci||PRHSX||n/a||5||99.65||n/a||104||-25.4||83.84||-19.45||-7.79||84.35|
|iShares U.S MedT||IHI||50||5||54.83||65.85||-24.67||48.07||-27||-7.81||47.56|
|Bristol Myers Sq||BMY||3.77||70.71||13.41||-2.83||70.62|