Here is your guide for biotechnology companies that work on coronavirus

A nurse holds a one-dose vial and a syringe prepared for the measles, mumps, and rubella vaccine made by Merck at the Utah County Health Department on April 29, 2019 in Provo, Utah.

George Frey | fake images

The deadly coronavirus worsened rapidly this month, shaking financial markets as investors fled risky assets amid concerns that the outbreak would disrupt the global economy. Meanwhile, several biotechnology companies have intensified vaccine or drug programs to combat the disease, which has caused investors to raise their shares amid the market downturn.

Merchants hope that their initiatives to develop the treatment and prevention of coronavirus can take shape at some point. Vir Biotechnology increased 111% in the last month, while Novavax gained 91% during the same period.

“At least a dozen companies have formally or informally announced vaccine or drug development initiatives to address” the virus, Needham analyst Alan Carr said in a note. “It seems that at least a few programs will have passed clinical trials in a few months.”

These programs include drugs already approved for other viral infections, unapproved drugs initially developed for other viruses, new monoclonal antibodies, new vaccines, the analyst said.

Inovio Pharmaceuticals shot up 37% in January, as it said it is in the process of developing a vaccine against the new deadly virus.

But analysts warned that any commercial Inovio treatment could be years away. Buyers in these actions should be careful, since that could be the problem with any of these names in the midst of unbridled speculation.

Morgan Stanley is optimistic about Moderna, who recently indicated that he is working on a possible coronavirus vaccine.

“Moderna has a potential benefit over traditional vaccine manufacturers in that once it has the sequences that encode the most immunogenic part of the surface proteins of the virus, or antigens, management can quickly become a candidate for clinical development. “said bank analyst Matthew Harrison. on a note

The analyst also has high hopes for Regeneron, saying his detection technology could be used to potentially produce therapeutic antibodies against the virus.

“During the Ebola outbreak, Regeneron was able to move from development to the validation of his therapeutic candidate in 6 months,” Harrison said.

– CNBC’s contributed to this report

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Wall Street assesses the impact of the coronavirus

The Dow Jones industrial average increases 124 points

The Dow rose 124.99 points, or 0.43%, to end the day at 28,859.44. The S&P 500 rose 0.31% to 3,283.66. The Nasdaq compound closed 0.26% higher at 9,298.93. Stocks fell for much of the day, as investors assessed the possible economic impact of the deadly coronavirus, but changed course after the World Health Organization declared the outbreak as a global health emergency.

Fears of viruses

Chinese authorities said the death toll from the coronavirus has exceeded 150 with confirmed cases exceeding 8,000. This led investors to sell some of their equity stakes and buy in safe shelters like the Treasurys, pushing the 10-year rate below their 3-month counterpart. This triggered the so-called performance curve inversion, an event that preceded recessions in the past. However, the main averages were recovered after the announcement of the WHO, which noted that the Chinese authorities had the situation under control and did not recommend restricting travel to China.

Facebook falls, Tesla becomes ridiculous

Facebook shares fell 6.14% after the company’s last quarterly results showed a sharp increase in costs. Meanwhile, Tesla increased more than 10.30% after its fourth-quarter earnings exceeded expectations.

What happens next?

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SpaceX can build Starship rockets in the Port of Los Angeles

A SpaceX installation under construction in this aerial photograph taken in April 2018 over the Port of Los Angeles.

Bloomberg

SpaceX is talking with government officials about the construction of a major manufacturing plant in the Port of Los Angeles, CNBC confirmed Wednesday.

The new rocket factory would build the huge next-generation SpaceX rocket called Starship. But the agreement itself is not completely new: the company already had the approval to build the facilities in 2018, and the city and the port signed a 10-year lease to $ 1.4 million per year. But SpaceX backed down last year, a move that Los Angeles city councilman Joe Buscaino said was “overwhelming” given the city’s great hope to rebuild the port.

“We know the importance of building Starship in San Pedro,” Buscaino told CNBC. “If San Pedro is good enough for Elon Musk, then it will be good for other innovators.”

BOCA CHICA, TX – SEPTEMBER 28: Space enthusiasts watch a prototype of the SpaceX Starship spacecraft at the company’s launch facilities in Texas on September 28, 2019 in Boca Chica, near Brownsville, Texas.

Loren Elliott | Getty Images News | fake images

SpaceX already leases more than 8 acres of land in the outer harbor of San Pedro. However, the company largely uses these lands as a transition point for when its rocket projectors land on a barge and need to be sent back to SpaceX headquarters near Los Angeles International Airport. This agreement would add 18 acres in the heart of the Port of Los Angeles, on Terminal Island.

SpaceX rejected CNBC’s request for comments on the discussions. Los Angeles Port spokesman Phillip Sanfield confirmed that negotiations were ongoing with SpaceX, but declined to comment further.

The Daily Breeze, a local newspaper in Los Angeles, first reported the news.

Buscaino said SpaceX Chief Financial Officer Bret Johnsen arrived at his office two weeks ago and apologized for withdrawing from the agreement the first time, adding that SpaceX had a new vision on how to continue developing Starship. The rocket, designed to be completely reusable and transport up to 100 people into space, has so far been built and tested at SpaceX facilities in Texas and Florida. But most of the more than 6,000 SpaceX employees work at their headquarters a short drive from the Port of Los Angeles, so Buscaino believes it is a natural addition to the company.

“I am happy to know that Brett saw that it is appropriate today, that it is a good business decision to keep his employees in the area,” Buscaino said.

According to the councilman, the new factory would generate 300 jobs, of which more than two-thirds would come from the SpaceX headquarters. In addition, Buscaino said Johnsen pressed to see how quickly a new agreement could be drawn up. The installation itself would be a large tent-like structure, similar to those used when Tesla was increasing the production of its cars in recent years.

“They want to be operational in the next 90 days,” Buscaino said.

The commissioners of the Port of Los Angeles will discuss the permit next Thursday, and the agreement will arrive as soon as the commission meeting on February 20.

“We have daily calls with SpaceX and the city entities just to make sure we are still on the same page,” Buscaino said. “This would be a long-term lease with SpaceX, with the investment coming from SpaceX itself.”

The port would provide SpaceX with immediate access to water, key to transporting its immense rocket from a production facility to launch sites in Texas or Florida. SpaceX currently moves Falcon 9 rockets across the road in super long trucks, but Starship and its “Super Heavy” propeller would be too large to transport on the road.

Buscaino personally is a Musk fan and writes in a tweet that the billionaire “is the modern Henry Ford, Leonardo Da Vinci and Howard Hughes, all in one.”

“My message to Elon Musk and other innovators: if you want to try something new, come to my district,” Buscaino said. “We will not get in the way.”

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Retail investors ‘have better knowledge’

Tesla CEO Elon Musk doesn’t have much love for Wall Street, a fact he often mentions, even in conference calls about earnings.

To begin, Musk’s company makes a non-traditional quarterly call with shareholders: after making a brief statement about Tesla’s results, it then answers the questions of anonymous retail investors, and the largest Wall Street companies make the latest questions.

Musk explained a little more his disgust for leading analysts in the middle of Wednesday’s call. A retail investor, another name for a non-professional individual investor, asked Musk: “Do you have to answer analyst questions?”

“Well, I guess we don’t have to,” Musk replied. “I think many of the retail investors actually have deeper and more accurate knowledge than many of the big institutional investors and certainly have better knowledge than many of the analysts.”

Little love is lost from the point of view of analysts. Despite the recovery of more than 160% of Tesla’s shares in the last six months and two consecutive profitable quarters, analysts from major firms such as JP Morgan, Barclays and Morgan Stanley reiterated their recommendations for the sale of Tesla shares.

“The bull’s narrative has shifted from Tesla by disrupting multiple industries so that Tesla is a profitable and growing next-generation car manufacturer. Even if it were stipulated that this is true, we believe the actions are overvalued as a car [manufacturer]”Barclays analyst Brian Johnson wrote.

Ryan Brinkman of JP Morgan also got caught by his low performance rating in Tesla. He adjusted his target price just a little, to $ 260 per share from $ 240 per share, expecting the stock to fall by approximately 60% of current levels.

Musk also thought about Wall Street predictions.

“It seems that if people really looked at some of the smart analysts of retail investors, what some of those smaller retail investors predicted about Tesla’s future, they would probably get the most accuracy and a remarkable insight into some of those predictions,” said Musk said.

Tesla analysts ‘cheeky’

Musk has taken photos of analysts before, even in a May 2018 call that Adam Jonas of Morgan Stanley described as “the most unusual call I’ve experienced in 20 years on the sales side.” Musk started that call saying he wanted to “answer as many questions as possible”, but with a warning: “Whenever there are good questions to answer.”

Later in that call, Bernstein’s analyst, Toni Sacconaghi, asked Musk where Tesla was in terms of his capital requirements.

“Excuse me? Next. Boring and silly questions are not great,” Musk replied.

Tesla’s shares fell the day after that call, and investors did not kindly accept what Musk had to say. While Musk reiterated his view of analysts during Wednesday’s conversation, he was more moderate in his comments.

Tesla shares recently exceeded $ 100 billion in market value. If it stays above that level for a certain period of time, Musk could earn the first installment of a payment that could be worth more than $ 55 billion over the next decade.

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Brent raw futures, coronavirus, US inventories in focus

Oil prices fell on Thursday when the death toll from the new virus in China rose to 170 and more airlines canceled flights to major cities in the country, while rising US crude oil inventories. UU. It added to the negative tone.

Brent dropped 35 cents, or 0.6%, to $ 59.46 a barrel at 0225 GMT, rising 0.5% on Wednesday. US crude fell 30 cents, or 0.6%, to $ 53.03 per barrel, after falling 0.3% in the previous session.

Even so, oil prices have stabilized in recent days after a fall that led to a minimum of three months and the market is trying to assess the damage to economic growth and the demand for crude oil and its products.

“There is no compelling case that oil should go down until we know more about how serious the destruction of the demand for the coronavirus epidemic will be,” said Greg Priddy, Stratfor oil analyst.

A second flight of Japanese evacuees from Wuhan, China, where the outbreak began, landed in Japan on Thursday, with nine symptoms of fever or cough, NHK said. Infections in China have passed 7,700.

The Emergency Committee of the World Health Organization is scheduled for another meeting later Thursday to reconsider whether the rapid spread of the virus should now be called a global emergency.

Airlines around the world suspend or reduce direct flights to major cities in China as governments issue travel warnings and the number of passengers decreases.

The larger than expected gains in US crude oil inventories last week also meant that “oil prices were treated with the cruelest hand of all,” said Stephen Innes, chief market strategist at AxiCorp.

Crude stocks increased market expectations more than seven times, earning 3.5 million barrels in the week as of January 24, the US Energy Information Administration (EIA) said on Wednesday. UU.

Gasoline stocks rose to an all-time high, rising for the 12th consecutive week to 261.1 million barrels, the EIA said.

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The dollar maintains profits while investors evaluate the damage of the Chinese virus

John Phillips | Digital editor | CNBC

The dollar remained near the two-month highs on Wednesday and other currencies seen as safe havens stabilized as investors regained their composure after a coronavirus outbreak in China, awaiting more news about possible economic damage.

The strong performance of the dollar this week, helped by the relatively positive performance of the US economy, has underlined its credentials of safe haven.

The dollar index rose 0.1% for the last time at 98,089, while the euro fell 0.2% against the US currency by $ 1,1002, not far from its weakest level since the beginning of November 29.

The dollar has now risen 1.8% against a basket of major currencies so far in 2020, before a Federal Reserve meeting on Wednesday.

The Fed is not expected to change interest rates when it gives its decision at 1900 GMT, but investors will want to know if President Jerome Powell retains his cautiously optimistic language.

ING analysts said that since the market has already set the price in another rate cut of 25 basis points of the Federal Reserve in 2020, the US currency. UU. It looked like it would have recent gains.

“With moderate prices already established, the bar for a fall in the dollar against low-yield currencies such as JPY or EUR remains high,” they wrote in a research note.

The yen, which rose earlier this week when investors bought in a currency considered a safe reserve of value in times of stress, was trading at 109.10 yen per dollar, a marginal increase on the day.

The Swiss franc recovered 0.1% to 1.0713 francs per euro, but was far from Tuesday’s high of 1.0666.

“The dollar has a superior performance and illustrates in an impressive way who is the definitive safe haven in the FX universe, regardless of whether that is justified or not,” said Commerzbank analyst Antje Praefcke.

The newly identified coronavirus has created an alarm because it is spreading rapidly and little is known about it. The death toll rose sharply to 132 on Wednesday, with almost 1,500 new cases identified for a total of almost 6,000.

But there was evidence that investors were becoming more relaxed. The offshore yuan, very sold in recent days, was marginally stronger at 6,9605 per dollar, compared to Monday’s 6.9900, the weakest in almost a month.

Sterling fell 0.1% to $ 1.3020 before a meeting of the Bank of England on Thursday. Investors are divided on whether it will reduce rates.

The Australian dollar consolidated its rebound from a minimum of 3 and a half months after more firm than expected inflation data. The Aussie was not last modified on the day at $ 0.6761.

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