From the FT:
The dollar fell to its lowest level in almost a year on Tuesday as a rally in gold prices above $1,000 an ounce and fresh concerns over its reserve status weighed on the US currency. Derek Halpenny at Bank of Tokyo-Mitsubishi UFJ said the dollar's near-term prospects did not look particularly encouraging. "Gold has just broken through the $1,000 level and this along with the dollar index approaching its lows may well encourage another wave of speculative dollar selling," he said. The dollar index, which tracks its progress against a basket of six major currencies, fell to a low of 77.398, breaking through the lows it hit in early August to fall to its weakest level since September 30 2008.
• Gold mining ETF GDX rockets 12%... gold jumps over $1,000 an ounce.
• Teen retailers Gap and Aeropostale hit new highs... Abercrombie drops 12% last week.
• Semiconductor makers extend gains... Silicon Labs, Advanced Semi, and others reach 52-week highs.
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Showing posts with label sectors. Show all posts
Showing posts with label sectors. Show all posts
Tuesday, 8 September 2009
Monday, 27 July 2009
Overbought
We have an interesting chart from Bespoke Invest where the current levels of the different sectors of the S&P500 are highlighted. OS and OB stands for overbought levels and oversold levels. The only sector not overbought, following the monster rally of july 10th is the energy sector. Even more: 6 out of 10 sectors are currently trading at or near extreme overbought levels.
So this cannot go on for a long time.
So this cannot go on for a long time.
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Tuesday, 21 July 2009
Crucell
Drug groups to reap swine-flu billions: that’s a header in the dailies today.
Some 740 people have died from the H1N1 virus following the latest estimates. Analysts expect to see a boost in sales from GlaxoSmithKline, Roche and Sanofi-Aventis when the companies report first-half earnings lifted by government contracts for flu vaccines and antiviral medicines.
The fresh sales – on top of strong results from Novartis of Switzerland and Baxter of the US, which both also produce vaccines –
GlaxoSmithKline of the UK confirmed it had sold 150m doses of a pandemic flu vaccine – equivalent to its normal sales of seasonal flu vaccine – to countries including the UK, the US, France and Belgium, and was gearing up to boost production.
GSK also produces Relenza, an antiviral medicine that reduces the length and severity of the infection, and is preparing to increase manufacturing towards 60m annual doses. The UK placed an order for 10m treatments this year.
One beneficiary of the fears about the pandemic has been Roche of Switzerland, which sells Tamiflu, the leading antiviral drug, and has seen a sharp rise in orders from private companies as well as governments.
This story is well-known.
Less known however is that big drug companies do no develop these drugs themselves anymore. They produce. The development is done by small boutiques receiving a royalty on the sold volume. One such outlet is the Dutch company: Crucell.
Some 740 people have died from the H1N1 virus following the latest estimates. Analysts expect to see a boost in sales from GlaxoSmithKline, Roche and Sanofi-Aventis when the companies report first-half earnings lifted by government contracts for flu vaccines and antiviral medicines.
The fresh sales – on top of strong results from Novartis of Switzerland and Baxter of the US, which both also produce vaccines –
GlaxoSmithKline of the UK confirmed it had sold 150m doses of a pandemic flu vaccine – equivalent to its normal sales of seasonal flu vaccine – to countries including the UK, the US, France and Belgium, and was gearing up to boost production.
GSK also produces Relenza, an antiviral medicine that reduces the length and severity of the infection, and is preparing to increase manufacturing towards 60m annual doses. The UK placed an order for 10m treatments this year.
One beneficiary of the fears about the pandemic has been Roche of Switzerland, which sells Tamiflu, the leading antiviral drug, and has seen a sharp rise in orders from private companies as well as governments.
This story is well-known.
Less known however is that big drug companies do no develop these drugs themselves anymore. They produce. The development is done by small boutiques receiving a royalty on the sold volume. One such outlet is the Dutch company: Crucell.
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Thursday, 2 July 2009
The big reversal trade
Some weeks ago we mentioned the following trade: long stocks, long commodities short dollar and short bonds. Look what happened in June. This trade was reversed. With the new quarter started it will be exiting to see what the next big trade will be.
What are the chances a new bull market in stocks will be the next big thing. First: it takes bulls to have a bull market. Or Big Money. But program trading data – soon to be abolished – suggest that the Big Boys are loaded with long position in indexfutures making them the only bulls in town in their league. I mean: the dumb money is bullish to, but not able anymore to move markets as computers and hedggies have overtaken these markets.
Does it make sense to lower the volume in order to let the individual investor participate in the direction of the market while taking the other side? Of course, but it means less profit and these guys are soooo greedy…
What are the chances a new bull market in stocks will be the next big thing. First: it takes bulls to have a bull market. Or Big Money. But program trading data – soon to be abolished – suggest that the Big Boys are loaded with long position in indexfutures making them the only bulls in town in their league. I mean: the dumb money is bullish to, but not able anymore to move markets as computers and hedggies have overtaken these markets.
Does it make sense to lower the volume in order to let the individual investor participate in the direction of the market while taking the other side? Of course, but it means less profit and these guys are soooo greedy…
Anyway. We think financials still play an important roll and it doesn’t seem there’s much bullish action going on in this sector.
Tomorrow, US markets will be closed.
Monday, 22 June 2009
Rotation
Sector rotation is under way.
The new winner is healthcare. And the contract research organizations. Names in this particular sector are Parexel (ticker: PRXL), Icon (ticker/ ICLR), CRL (Charles River Laboratories) and Covance (ticker: CVD).
As the Obama government starts to give more and more details on their plans for Medicare , investors seems to be tempted to buy these names.
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The new winner is healthcare. And the contract research organizations. Names in this particular sector are Parexel (ticker: PRXL), Icon (ticker/ ICLR), CRL (Charles River Laboratories) and Covance (ticker: CVD).
As the Obama government starts to give more and more details on their plans for Medicare , investors seems to be tempted to buy these names.
Friday, 12 June 2009
Sector rotation: get out
We observe that the heroes from some weeks ago are rolling over: restaurant chains are on their way back. A classic example of sector rotation by the pro’s. Forget all the stories written a month ago about this topic. Too many folks around trying too fool us while obliged to make a living. Journalists, I mean.
And here are the heroes of one session. Auto parts shares are tumbling after the outburst on Wednesday.
Also the housing sector is rolling over. Not yet, but nearly
Also the housing sector is rolling over. Not yet, but nearly
Folks, it's friday evening here. The pub is waiting for us and I want to enjoy the light breeze coming from sea to the shores and sun filtering through clouds. Let's sing till midnight. Take care.
Monday, 25 May 2009
The dollar is sailing south
Related they all are: the dollar, interest rates and the commodities. Of course we’re hoping that for gold this will be the big one, but then the dollar has to go down further (which I don’t believe) or gold needs to rise as a stand alone.
We believe we still are in a disinflationary environment, so the dollar will not run too far and the FED will cough up more QE by buying up bonds.
If the dollar continues to decline, how are specific asset classes reacting? What’s the historical correlation to the dollar of the 10 sectors within the S&P500.
From David Rosenberg:
We believe we still are in a disinflationary environment, so the dollar will not run too far and the FED will cough up more QE by buying up bonds.
If the dollar continues to decline, how are specific asset classes reacting? What’s the historical correlation to the dollar of the 10 sectors within the S&P500.
From David Rosenberg:
• Basic materials 87% inverse correlation
• Consumer staples 79% inverse correlation
• Industrials 62% inverse correlation
• Consumer discretionary 34% inverse correlation
• Utilities 28% inverse correlation
• Financials 22% inverse correlation
• Health care 18% inverse correlation
• Tech 5% positive correlation
•Telecom 13% positive correlation
Friday, 8 May 2009
The Big Boys are playing
Looking to the action yesterday we notice how the market is eager to go down. As an example we take the Direxion Daily Small Cap Bear 3x Shares where: look to the surge of volume yesterday. Not normal.
It’s Bespoke Invest who is dissecting this market in details:
Today was one of those rare days (at least based on the last two months) that the market declined. While the index was down a little more than 1%, the average stock in the index was down more than 2%, which indicates that the largest stocks in the index held up better than the smallest stocks. We also broke the index into deciles (50 stocks in ten groups) based on their performance from the start of the rally through yesterday's close to see how they performed today. While the very best performing stocks during the rally actually held up okay today, the 2nd, 3rd, and 4th best deciles were down big today. The two deciles of stocks that were up the least during the rally were also down the least today.
What do we learn: the pro’s are playing this market very well.
Ok, lads, this was the week, see you all in the pub for a good beer. Enjoy…
Thursday, 7 May 2009
If pigs could fly, this place would be a busy airport
De lack of attention concerning the swine flu thing is amazing. Here’s a last update coming from Goldman Sachs:
"Production of hundreds of millions of doses of swine flu vaccine may move ahead next week after the virus spread to 23 countries and 41 U.S. states, world health officials said. The number of confirmed cases in the U.S. jumped to at least 642, led by an outbreak in Illinois, after state health labs received kits to perform their own tests of people with symptoms, the U.S. Centers for Disease control and Prevention said today on its Web site. The cases include two U.S. deaths and may represent a fraction of the total cases, officials said. Disease trackers are monitoring 81 cases in Spain and 27 in the U.K. to determine whether the virus formally called H1N1 has established itself outside North America. Such a finding would prompt the World Health Organization to declare a pandemic, the first since 1968, the agency said. A WHO panel will meet next week to discuss whether vaccine makers should begin producing a swine flu shot once they finish with the seasonal flu vaccine. "We have recommended for all manufacturers to put everything into place to be able to start manufacturing the vaccines," Marie-Paule Kieny, director of WHO’s initiative on vaccine research, said today at a news conference in Geneva. "A further review might be potentially to stop seasonal vaccine production." WHO, the United Nations’ health agency based in Geneva, determined that a swine flu shot would have to be made in separate plants from the seasonal flu version. Swine flu vaccine may also require a follow-up booster shot in order to be effective because it is an entirely new strain, Kieny said. The single-shot seasonal flu vaccine itself acts as a booster, reinforcing natural antibodies from previous exposures to viruses."
Until now, the standard flu vaccines are going to make us rich. The reason: the real customers of these vaccines are the governments. This is already an established industry and yields tend to be driven down by competition. The most important vaccines are produced by:
· Novavax (NASDAQ: NVAX)
· Dynavax (NASDAQ: DVAX)
· Hemispherx Biopharma (AMEX: HEB)
· BioCryst Pharma (NASDAQ: BCRX)
· AVI BioPharma (NASDAQ: AVII)
· deCode Genetics (NASDAQ: DCGN)
· Crucell (NASDAQ: CRXL)
· Vical (NASDAQ: VICL)
Instead think about this: biochip sensors. Last year, agricultural losses of hundreds of millions of dollars were caused by the inability to quickly locate the source of a salmonella infection. What is needed, and will arrive in the not-so-distant future, are sensors that can detect disease pathogens cheaply and instantaneously.
EETimes is reporting that CombiMatrix Corp. has made biochips that can be programmed to identify any known flu type. CombiMatrix says its microarray can be updated for new influenzas in less than a day and can deliver test results in only four hours.
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"Production of hundreds of millions of doses of swine flu vaccine may move ahead next week after the virus spread to 23 countries and 41 U.S. states, world health officials said. The number of confirmed cases in the U.S. jumped to at least 642, led by an outbreak in Illinois, after state health labs received kits to perform their own tests of people with symptoms, the U.S. Centers for Disease control and Prevention said today on its Web site. The cases include two U.S. deaths and may represent a fraction of the total cases, officials said. Disease trackers are monitoring 81 cases in Spain and 27 in the U.K. to determine whether the virus formally called H1N1 has established itself outside North America. Such a finding would prompt the World Health Organization to declare a pandemic, the first since 1968, the agency said. A WHO panel will meet next week to discuss whether vaccine makers should begin producing a swine flu shot once they finish with the seasonal flu vaccine. "We have recommended for all manufacturers to put everything into place to be able to start manufacturing the vaccines," Marie-Paule Kieny, director of WHO’s initiative on vaccine research, said today at a news conference in Geneva. "A further review might be potentially to stop seasonal vaccine production." WHO, the United Nations’ health agency based in Geneva, determined that a swine flu shot would have to be made in separate plants from the seasonal flu version. Swine flu vaccine may also require a follow-up booster shot in order to be effective because it is an entirely new strain, Kieny said. The single-shot seasonal flu vaccine itself acts as a booster, reinforcing natural antibodies from previous exposures to viruses."
Until now, the standard flu vaccines are going to make us rich. The reason: the real customers of these vaccines are the governments. This is already an established industry and yields tend to be driven down by competition. The most important vaccines are produced by:
· Novavax (NASDAQ: NVAX)
· Dynavax (NASDAQ: DVAX)
· Hemispherx Biopharma (AMEX: HEB)
· BioCryst Pharma (NASDAQ: BCRX)
· AVI BioPharma (NASDAQ: AVII)
· deCode Genetics (NASDAQ: DCGN)
· Crucell (NASDAQ: CRXL)
· Vical (NASDAQ: VICL)
Instead think about this: biochip sensors. Last year, agricultural losses of hundreds of millions of dollars were caused by the inability to quickly locate the source of a salmonella infection. What is needed, and will arrive in the not-so-distant future, are sensors that can detect disease pathogens cheaply and instantaneously.
EETimes is reporting that CombiMatrix Corp. has made biochips that can be programmed to identify any known flu type. CombiMatrix says its microarray can be updated for new influenzas in less than a day and can deliver test results in only four hours.
Thursday, 30 April 2009
This sector is breaking out...
Schlumberger is an example of how the oil service industry fared lately. Looking to the first quarter earnings of this company, we observe how they tumbled with 30%. The world's largest oilfield services company said net income in the January-to-March period fell to $938.5 million, or 78 cents per share, versus $1.34 billion, or $1.09 per share, a year earlier.
But if one take a look to the OIH index than we see the bullish sign.
But if one take a look to the OIH index than we see the bullish sign.
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Flying too high
There are three Mexican airport stocks: Grupo Aeroportuario del Sureste (ticker: ASR), Grupo Aeroportuario del Pacifico (ticker: PAC), and Grupo Aeroportuario del Centro Norte (ticker: OMAB). Although they seem financially in a good shape, they can not escape the fall-out of the swine flu reports.
And they are hit. But not too hard, until now.
And they are hit. But not too hard, until now.
If governments however wil start to issue negative advices to go to Mexico, this may change.
Don’t forget to look to this category of stocks once this outburst of fear is over.
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Wednesday, 22 April 2009
Icarus
As a reminder how fragile biotech stocks can act, we show a picture of Kendle International. Which was halved yesterday after the company announced that it will not meet analyst expectations for the first quarter of 2009.
From Reuters:
Shares of Kendle International Inc (KNDL) fell as much as 61 percent to a four-year low on Tuesday, a day after the provider of clinical development services to biopharmaceutical firms said it would miss analyst expectations for the first quarter. In a regulatory filing, Kendle said its cancellation rate in the first quarter was more than 45 percent, compared with a forecast of 18 percent.
Also colleagues ICON (ticker: ICLR) and Parexel International (ticker: PRXL) were beaten down.
From Reuters:
Shares of Kendle International Inc (KNDL) fell as much as 61 percent to a four-year low on Tuesday, a day after the provider of clinical development services to biopharmaceutical firms said it would miss analyst expectations for the first quarter. In a regulatory filing, Kendle said its cancellation rate in the first quarter was more than 45 percent, compared with a forecast of 18 percent.
Also colleagues ICON (ticker: ICLR) and Parexel International (ticker: PRXL) were beaten down.
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Friday, 20 March 2009
To FAS or to FAZ
I love this bonus rage in the States.
And the tax of 90%.
Where is it going to stop? Is the mob going to take the streets again?
They drag the CEO before Congress to grill him and chastise him over the bonuses of AIG. This is a guy who came out of retirement to work for 1 USD a year to try and turn this thing around.
The mob hasn’t changed that much over the centuries.
Ok.
Let’s get over it.
And go elsewhere.
Also the FAS (3x Leveraged Financial ETF) is going down. Yesterday it opened 10% higher only to close 5% down. Is the short squeeze over?
And the tax of 90%.
Where is it going to stop? Is the mob going to take the streets again?
They drag the CEO before Congress to grill him and chastise him over the bonuses of AIG. This is a guy who came out of retirement to work for 1 USD a year to try and turn this thing around.
The mob hasn’t changed that much over the centuries.
Ok.
Let’s get over it.
And go elsewhere.
Also the FAS (3x Leveraged Financial ETF) is going down. Yesterday it opened 10% higher only to close 5% down. Is the short squeeze over?
The most popular stocks these days are FAZ and FAS. In this all shorting story of financial stocks, these ETF become increasingly popular.
This is the FAZ (thanks Tim). Look how positive momentum is building like a storm after a hot day. The volume is increasing while the price is not going lower anymore. Ready for this ride?
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And the winner is...
From Bespokeinvest we learned this about the rally of last week:
Below we highlight sector performance during the current rally that started last Tuesday. As shown, the Financial sector is up a whopping 50% since the close on March 9th! The S&P 500 as a whole is up 17.4%, and Telecom, Materials, Industrials, and Consumer Discretionary are all outperforming. Consumer Staples, Health Care, Energy, Utilities, and Technology are underperforming the S&P 500.
Below we highlight sector performance during the current rally that started last Tuesday. As shown, the Financial sector is up a whopping 50% since the close on March 9th! The S&P 500 as a whole is up 17.4%, and Telecom, Materials, Industrials, and Consumer Discretionary are all outperforming. Consumer Staples, Health Care, Energy, Utilities, and Technology are underperforming the S&P 500.
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