The Bear Den by Shortside Jonny
Monday, June 7, 2021- DIA 346.59 -.385, QQQ 336.60 +.30%, SPY 422.26 -.08%
No high-impact data released on the day. The two best performing sectors were Real Estate (XLRE) 44.98 +.94% and Communications (XLC) 79.60 +.52% Basic Materials (XLB) 86.84 -1.22% was the laggard with 3M (MMM) 203.73 -1.13% dragging down the DJIA. Biogen, Inc. (BIIB) 395.85 +38.34% surged after receiving a surprise approval from the FDA for its Alzheimer’s drug Aduhelm, which works on removing the brain plaques associated with the disease. Eli Lilly (LLY) 222.52 +10.15% moved higher in tandem with Biogen as investors assessed a higher probability of FDA approval for its own Alzheimer’s drug, Aducanumab. High short interest stocks & meme stocks featured on Reddit/Wallstreetbets were big movers on the day: Clover Health (CLOV) 11.92 +32.4% & Bed Bath & Beyond (BBBY) 33.98 +7.16%.
Tuesday, June 8, 2021 – DIA 346.43 -.07%, QQQ 336.76 +.05%, SPY 422.28 +.02%
JOLTS reported a series high of 9.3 million job openings at the end of April. Hires were little changed at 6.1 million while total separations increased to 5.8 million. It appears that with the reopening of the economy, people are actively changing & moving jobs. Energy (XLE) 55.99 +.86% was the top-performing sector on the day, with Chevron (CVX) 108.73 +.91% leading the DJIA. Diamondback (FANG) 89.64 + 2.81% moved to a 52 week high. SiriusXM Inc. (SIRI) 7.09 +7.42% rose to a 4-month high. The stock has a short interest of 20% of the public float. On the downside, Micron Technology (MU) 80.53 -4.18% got hammered after Edgewater Research lowered their estimates for DRAM chips due to a projected increase in supply and softer future demand. The short hunting continues as Clover Health Investments (CLOV) 22.15 +85.8% gapped higher on the open, hitting an intraday high of 24.93 before taking a breather. The stock has almost doubled in a week.
Wednesday, June 9, 2021 – DIA 344.79 - .45%, QQQ 336.84 +.02%, SPY 421.65 -.15%
No high-impact data released on the day. The major averages were mixed and consolidating ahead of Thursday's CPI release. El Salvador announced that Bitcoin would be allowable legal tender in the country. Healthcare was the lead sector on the day (XLV) 123.33 +.97%; Merck & Co. (MRK) 74.04 +2.27% & Johnson & Johnson (JNJ) 165.59 +1.35%. Industrials (XLI) 103.81 -1.02 were the clear laggards on the day with Caterpillar getting hit hard (CAT) 234.65 -2.29%. Boeing (BA) 248.06 -1.86% was also weak. Aethlon Medical (AEMD) 10.79 +388% quadrupled after releasing a white paper on its stage 1 trial for a blood cleaning technology, named Hemopurifier. The device is said to have the ability to filter viruses and exomes from a patient’s blood. Biotechnology concern BioMarin (BMRN) 82.05 +4.18% moved higher. The stock recently broke out from a 6-month downtrend and appears to be reasserting. High short interest meme stocks featured on Reddit/Wallstreetbets such as The Geo Group (GEO) 8.80 +38.36% were catching trader interest. In frenetic trading, Clover Health Investments (CLOV) 16.92 -23.6% hit a high of 28.85 before collapsing to close near the low of the day.
Thursday, June 10, 2021 – DIA 344.98 +.06%, QQQ 340.35 +1.04%, SPY 423.61 +.46%
Initial Jobless Claims came in at a pandemic low of 376K which was a little above consensus expectations Consumer Price Index (YoY) came in at +5% v. +4.7% expected. Ex-Food & Energy (YoY) came at +3.8% v. +3.4%. The markets shrugged off the inflationary data after some initial downside volatility. The 10-year note index (TNX) 14.59 -.30 counterintuitively dropped, which sparked the equity markets higher. The S&P hit a new record. Healthcare (XLV) 125.44 +1.71% was the lead sector on the day, with Walgreen’s Boots Alliance (WBA) 55.31 +3.52% announcing it would extend pharmacy hours by 3 hours to accommodate walk-in vaccinations. The stock has had a high consolidation and appears to have reasserted to the upside. Restoration Hardware (RH) 707.14 +15.67% beat on earnings and revenue. The stock broke out of an ascending triangle pattern. Financials (XLF) 37.32 -1.17% were the laggard sector on the day as banks underperformed with Goldman Sachs (GS) 373.94 -2.31% dragging the sector down. Caterpillar (CAT) 225.73 -3.80% continued its notable weakness. The Meme-driven Reddit rollercoaster took a breather and all it took was a dash of company news and reality; GameStop (GME) 220.39 -27.16% announced earnings and a share dilution plan, and a warning from its chairman that its share price is a high-risk holding at these levels. Joining in the sea of Reddit-inspired red ink was; The Geo Group (GEO) 7.05 -19.89% which pulled back from the previous day's spectacular upside move. Bed Bath & Beyond (BBBY) 31.53 -8.05% also fell, as did AMC Entertainment (AMC) 42.81 -13.23%
Friday, June 11, 2021 – DIA 345.12 +.04%, QQQ 341.24 +.26%, 424.31 +.17%
Michigan Consumer Sentiment Index June preliminary was released with a reading of 86 v. 84 expected. Consumer exuberance can translate into greater spending and faster economic growth, implying a stronger labor market and a pickup in inflation. The markets were quiet with an upward bias. Financials (XLF) 37.56 +.64% were the lead sector in a quiet summer Friday session. American Express (AXP) 164.51 +1.41% paced the DJIA. Healthcare (XLV) 124.55 -.71% was dragged down by Vertex Pharmaceuticals (VRTX) 193.02 -10.96% which had heavy selling. The company released a statement that it would no longer pursue trials of a key drug VX-864 for AATD (Antitrypsin Deficiency) an inherited disorder. The stock broke down from the low of a trading range that had been established from Mid-October 2020 when the company first announced problems with the drug. On the upside, technology healthcare management firm ApolloMed Holdings (AMEH) 48.34 +20.22% was added to the S&P SmallCap 600. Vaxart Inc. (VXRT) 8.74 +21.90% popped on news that influential analyst Yasmeen Rahimi of Piper Sandler had initiated coverage with an Overweight rating and an $18 price target for the drugmaker.
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