Buzz Bits: Dow and Nasdaq Climb Higher
Your daily Buzz & Banter highlights.
Honest Abe - Todd Harrison - 3:22 PM
I've always believed that my greatest strength is understanding my weaknesses. So, while I know enough to know that I know very little, the following are things that I have a high degree of confidence in:
- The "Long Jo-Short Blair" trade was a huge winner.
- Today's rally had nothing to do with the 1.5% decline in crude.
- No matter how you slice it, we're still got lower highs in the S&P.
- Bailout plans, while they may offer perceived relief, are Band-Aids on a broken bone.
- The high road is less crowded and boasts a better view.
- I'm gonna face plant in a big way following Friday's Festivus for 300+ Minyans.
- Higher prices equal more risk, not the other way around.
- Minyanland will blow your mind and change the face of children's financial literacy.
- A dream is only as powerful as those who believe in it.
ODAC Panel Votes No for Avastin in Breast Cancer - David Miller - 2:43 PM
This will reflect poorly on Genentech's (DNA) stock and probably Wyeth's (WYE) as well. My guess is some will interpret it as bad for the oncology sector, too, though I think we learned nothing new today from this decision as it is essentially a repeat of the satraplatin decision in July.
This ODAC panel essentially repeated what it said in its previous meeting by denying Avastin for breast cancer. If survival data are in hand, then it must be positive or any surrogate endpoints don't matter. It makes no difference, contrary to Genentech's argument that several breast cancer drugs have been approved on progression free survival (PFS).
A negative outcome was the right bet for those who make a living out of watching ODAC and Pazdur's OOD. I will say I'm surprised the lure of all the money Genentech and Wyeth throw around to cooperative groups and academic centers for clinical trials didn't tip the balance. OOD chief Richard Pazdur's can add the established, organized and highly influential breast cancer lobby to his little black book of people who want him fired. I note he has enough trouble with the rapidly emerging and increasingly militant prostate cancer patient community to anger.
I believe Avastin works in a targeted breast cancer population. We'll see if Genentech repeats its Herceptin strategy and goes down that road next.
AIG - Kevin Depew - 1:51 PM
I was listening to the AIG (AIG) investor meeting and wanted to share a couple of bullet points with you on their view of housing in the future:
- 2008 will be like 2007 with home prices expected to decline 5% to 7%.
- They are looking for some stabilization in housing inventories, which are currently at 17-year highs, particularly if foreclosures improve due to the subprime rescue plan.
- The company isn't looking for a recovery in housing until 2009., but their economic assumptions show some improvement should begin in the latter half of 2008.
- However, if housing deteriorates more in 2008 beyond 2007 similarities, then that could change their outlook.
Movin' on Up! - Quint Tatro - 10:47 AM
After a robust opening, the averages are hanging tough at or near highs and individual stocks underneath are cooperating. I have taken the opportunity in the early strength to pare back some of the inventory I have been building. I am taking down some of the more extended names while reallocating into other areas I feel can gain further traction. I sold down a little more Evergreen Solar (ESLR), repositioning that money into a little more Peabody Energy (BTU) as coal stocks continue to gain attention.
I also started some very speculative China names as they look to be perking up a bit. I put a little China Natural Resources (CHNR) and China Direct (CDS) on the books and will keep a stop at day low. It has been my experience that when aggressive traders want beta, they flock to the China momentum names. We'll see if that happens today. Other than that, I have reset several alerts and now will sit back and wait to see what happens.
Position in ESLR, BTU, CHNR, CDS.
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