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T3's Take 3: Hillary Clinton Stings Biotech With a Single Tweet


Today's financial recap and tomorrow's financial outlook.

Today on T3 Live

T3 Live cordially invites you to our first annual Finance Festival, scheduled for November 6-8 in sunny Miami, Florida.

Since we announced the event on July 8, we've added some very big names to the agenda, including:

-David Kotok, Founder and Chief Investment Officer of Cumberland Advisors
-David Rosenberg, Chief Economist of Gluskin Sheff
-Ivan Zinn, Chief Investment Officer of Atalaya Capital Management

Read about our expanded lineup here.

Clinton Shakes Biotech 

Biotech stocks, already weak, took a big hit today after Democratic Presidential candidate Hilary Clinton tweeted a response to a New York Times article.

The article talked about Turing Pharmaceuticals, which recently raised the price of a drug to $750 per tablet from $13.50.

Clinton tweeted that "price gouging in the specialty drug market is outrageous. Tomorrow I'll lay out a plan to take it on."

The sector had been lagging the major indices, but it accelerated lower after the Tweet hit.

The S&P Biotechnology ETF (XBI) closed down 5.4% while the NASDAQ Biotechnology ETF (IBB) dropped 4.5%

Fed Bullard on CNBC

St. Louis Fed President James Bullard, who is not a voting member of the FOMC,, appeared on CNBC today. Bullard argued that it's for the Fed to raise interest rates, and that policymakers should not react to turmoil in financial markets, saying that the reasons the Fed cited to not raise interest rates on Thursday are probably overblown.

According to Bullard, "the impact of China coming directly back to the United States is relatively small." 

"There's a powerful case to be made that it's time to raise interest rates. And the case is not complicated... policy settings are [in] an emergency. The economy itself, the goals of the committee, have essentially been met." said Bullard. Even with higher rates, current monetary policy will remain supportive. 

Bullard also mentioned that the Fed cannot permanently raise stock prices, and the idea that the Fed is driving the stock market is untrue.

Markets rose after Bullard's appearance, particularly financials, which benefit from higher interest rates.

US stocks also got a boost from a speech from comments from Atlanta Fed President Dennis Lockhart (voting member of FOMC), who express condidence in a rate hike for this year.

The S&P 500 finished up 0.5% after giving up some gains midday.

World Equity Markets

The Shanghai Composite finished up 1.9% today, making most of its gains in the final hour of trading. China's top economic planner announced that reforms in energy, rail, and airline sectors will have mixed ownership between private and public entities.  The Hong Kong Hang Seng closed down 0.8%, while the Taiwanese TAIEX, and Korean Kopsi fell 1.83%, and 1.57% respectively. Japan's market remains closed for a holiday.

European markets were broadly higher today. The German DAX finished up 0.3% after a weak start, while the French CAC gained 1.1%. Auto makers were hit hard after Volkswagen (VW) admitted that the company's software for some of its diesel models misled buyers about. emissions.

Greece was back in the news after Alexis Tsipras was voted in as Prime Minister, overwhelming his opponents. On his address, he promised he will bring in a period of stability to Greece.

Tuesday's Financial Outlook

US economic news for tomorrow will include FHFA house price index, and Richmond fed manufacturing.

Overseas economic data will inlude Swiss trade balance, British public finances, euro-zone consumer confidence, and Caixin China PMI

AutoZone (AZO), CarMax (KMX), Carnival (CCL), and General Mills (GIS) will announce earnings before the open. There are no major earnings reports scheduled after the close. 
No positions in stocks mentioned.
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