Drug Stocks in the Crosshairs on Trump’s “Favored Nations” Plan

Move to lowest-cost drugs could save $3 billion per year. Drug and related stocks were among the worst market performers on Friday, after President Trump says his administration is working on a system to allow the U.S. to buy drugs based on the lowest prices paid by other countries. Such a plan, typically known in contracts as a favored-nations clause, would help keep a lid on drug costs for consumers, but would cut into the profitability of the drug companies. Last year, Trump proposed a similar pricing plan for drugs. Known as the International Pricing Index, the government is...
More

June Payrolls Rise by 224,000

Job growth goes beyond highest forecast for June. U.S. employers added 224,000 to their payrolls in June, per the job data that was released by the Bureau of Labor Statistics on Friday. That’s about three times larger than the revised 72,000 jobs numbers from May, and indicate a strong economy. The expectation was for 160,000 new jobs at best, and the number was higher than the most bullish forecast by Wall Street traders. The job growth was also the best monthly increase since January 2019. The numbers for May were also revised higher. The market, trading flat ahead of the ann...
More

Insider Activity: OncoCyte Corporation (OCX)

Major holder adds to stake in blood testing company. Insiders in the health, pharmaceutical, and biotech space continue to buy shares of their beaten-down companies near today’s prices. The latest big buy? At shares of one of the smaller diagnostic plays, OncoCyte Corporation (OCX). Last week, Broadwood Partners LP, which already owns more than 10 percent of shares in the company, added 1 million shares to their stake. At a price of around $2, this represented a $2 million buy. Founded in 2009, OncoCyte works on the development and commercialization of non-invasive, blood-based...
More

Unusual Options Activity: AngloGold Ashanti (AU)

Big bet on gold mining company shares moving higher this year. Shares of mining companies can be pretty volatile. If gold prices stop moving higher, the share price on these companies can drop quickly. Yet at least one trader is betting that mining giant AngloGold Ashanti (AU) will trade at least as high as it’s been if not higher by the end of January 2020. On July 3rd, there was a surge in trading on the January 2020 $18 calls. Shares last traded around $17.80, making this option at-the-money. In other words, in a volatile sector of the market, one trader is betting that shar...
More

Insider Activity: Dova Pharmaceuticals (DOVA)

Major holder adds to stake in beaten-down biotech company. Insiders in the health, pharmaceutical, and biotech space continue to buy shares of their beaten-down companies near today’s prices. The latest big buy? At shares of one of the smaller biotech plays, Dova Pharmaceuticals (DOVA). On July 3rd, the Perceptive Life Sciences Master Fund, which already owns more than 10 percent of shares and has a seat on the board of directors, added to their stake. The fund bought 20,541 shares, paying just under $300,000. But this isn’t their first buy with this company. They also bought s...
More

Currency Manipulation: The Next Trade War?

With trade deals underway, Trump hits Europe and China on currency programs. Although global markets were largely unchanged on Thursday, with U.S. markets closed, traders are starting to keep a closer eye on the currency markets. While largely unchanged right now, recent comments from President Trump indicated that currency manipulation by China and Europe was a problem, and that the United States should follow suit. Tweeting on Wednesday, the president said: “China and Europe playing big currency manipulation game and pumping money into their system in order to compete with USA. ...
More

US Factory Orders Contract for Second Month in a Row

Slight decline tied to drops in defense and Boeing orders. United States factory orders fell for a second month in a row, declining 0.7 percent month-over-month in May. This follows a 1.2 percent decline in April. Year-over-year growth is also down 1.2 percent, the lowest level of orders since August 2016. The largest factor in the drop was a decline in defense spending and non-defense aircraft spending. This adds to other pieces of economic data suggesting a slowdown largely in the industrial space, but one that could spill over into the rest of the overall economy. Howev...
More

Unusual Options Activity: General Electric (GE)

Big put option bet indicates decline in shares ahead. Shares of General Electric (GE) could be moving down over the summer. That’s based on an unusual bet: a surge in trading on the September $12 put options. Why is this unusual? Because shares are at $10.63, making the trade already in-the-money. There are a few reasons for this kind of trade. First, being in-the-money, the option should move down penny-for-penny with shares. However, if shares remain under $12 come September, the trader will be on the hook to sell shares at $12. That could be a sign of a hedge trade, either...
More

Tesla Motors Beats Delivery Goals

Deliveries beat expectations on Model 3 sales. In the second quarter of 2019, Tesla Motors managed to deliver a record number of vehicles, surprising most analysts. This allowed shares to rally on Wednesday. Overall, the company beat estimates by about 10 percent, and Model 3 deliveries surprised to the upside. Tesla also noted an improvement in its logistics and delivery operations, which helped meet the delivery totals and should drive down manufacturing costs per car. While the news is good short-term, there are longer-term issues that remain unaddressed. The next phase of th...
More

Insider Activity: The Kroger Co. (KR)

First insider buy at the grocery chain in two years. With so much conflicting economic data, investors may be looking for defensive investments. Corporate insider buying in the space is rare, which makes the recent insider buy at grocery chain The Kroger Co. (KR) so interesting. On July 2nd, director Ronald Sargent bought 5,000 shares, shelling out about $108,000 to add to his stake in the company. All told, he now owns just under 95,000 shares. This is the first insider buy in shares since July 2017. Based out of Cincinnati, Kroger operates over 2,700 grocery stores and over 1,...
More