Biogen CEO Sees Room to Pursue Two Similar Alzheimer's Hopefuls


Video commentary for November 14th 2018

Eoin Treacy's view
A link to today's video is posted in the Subscribers Area.

Some of the topics covered include: Wall Street unwinding a short-terim overbought condition following last week's rebound, China and Europe weak, Pound steady, oil shows first sign of steadying, gold steady around $1200.

EU Unveils No-Deal Brexit Plans to Avert Financial-Market Chaos
This article by Silla Brush and Alexander Weber for Bloomberg may be of interest to subscribers. Here is a section:
The EU executive also responded to industry warnings about Brexit’s threat to data flows between the EU and the U.K. A “broad toolbox for data transfers to third countries” is available under existing regulations, such as securing explicit consent from clients, so the commission said it’s not planning to issue the kind of “adequacy decision” that British lawmakers have called for.

No contingency measures will be needed for non-cleared “over-the-counter” derivative contracts or insurance policies, the commission said. U.K. regulators have been warning for more than a year that a disorderly Brexit with no transition period could put such financial contracts at risk.

The commission promised to issue an equivalence decision covering U.K. central security depositories, which settle trades in equities. Ireland has relied on a U.K.-based firm called Crest to settle trades since the 1990s.

Eoin Treacy's view
The timing of the EU announcing its willingness to deploy contingency plans in the event of the UK leaving the EU without an contingency agreement, the same day that they released the jointly agreed text, is a testament to the risk that the May government will fail in getting it through parliament. Continues in the Subscriber's Area.

Email of the day on tobacco stocks and accelerating trends:
As you rightly point out defensive stocks tend to outperform towards the end of the cycle, especially those that consistently pay a high dividend. I, like I suspect others in the collective hold BATs shares. Yesterday the price got hammered on a rumour that the FDA is proposing to ban menthol cigarettes. Wonder if you have any thoughts on what has happened ? Any crumbs of comfort to be had ?

Eoin Treacy's view
Thank you for this question and I suspect you are not alone in holding a share that has accelerated lower of late. At The Chart Seminar yesterday for example we had a discussion about British America Tobacco exhibit is accelerating downtrends. As you will remember acceleration is a trend ending characteristic;, albeit of unknown duration. Contuues in the Subscriber's Area.

GE Surges on $4 Billion Plan to Speed Cut to Baker Hughes Stake
This article by Brendan Case and David Wethe for Bloomberg may be of interest to subscribers. Here is a section:
“We like seeing GE’s new CEO Larry Culp hasten the pace of the company’s portfolio breakup to generate sale proceeds to de-lever the balance sheet,” Deane Dray, an analyst at RBC Capital Markets, said in a note to clients. “This is consistent with GE’s messaging that it has roughly $60 billion of potential sources of liquidity.”

Culp took over six weeks ago from John Flannery, who succeeded Immelt in August 2017.

GE was among Bridgewater’s new buys in the third quarter

GE advanced 7.8 percent to $8.61 at the close in New York, the biggest gain in more than four months. The shares had tumbled 54 percent this year through Monday, the third-biggest drop on the S&P 500 Index.

Eoin Treacy's view
General Electric has been accelerating lower and that also means that the issues assailing the company are becoming progressively better understood. The yield of the 5% junior subordinated perpetual bond have surged higher over the last week to 15%. That is a very accelerated decline so a lot of bad news has already been priced in. Continues in the Subscriber's Area.

Biogen CEO Sees Room to Pursue Two Similar Alzheimer's Hopefuls
This article by Naomi Kresge for Bloomberg may be of interest to subscribers. Here is a section:
Both compounds target beta amyloid, a protein consistently found in clumps in the brains of people with Alzheimer’s disease. Both are being tested in patients with very early signs of the disease, following a hypothesis that drugs might work best before Alzheimer’s advances. The companies are still talking with regulators about how to proceed, the CEO said.

Vounatsos, like others researching ways to fight the disease, said it may become necessary to combine different treatments, or give one after the other. “Alzheimer’s disease is so complex that a single silver
bullet will not solve the complexity of the disease for all patient types during the continuum of the evolution of the disease,” he said.

Before companies can engineer combinations, they need to find one that works. Biogen won’t disclose when it expects the final-stage study for its potential blockbuster aducanumab to finish, but it enrolled the last patient over the summer. The trial is planned to be about 18 months long.

Eoin Treacy's view
As the number of people living into their dotage increases, the need to contain the cost of healthcare is increasingly urgent. Alzheimer’s is a scourge for any family afflicted by its long slow ebb of critical faculties so any progress is developing a cure or even a partial treatment are to be welcomed. Progress is being made in early diagnosis but so far there is nothing that resembles a cure. Therefore the first company to come up with a solution, however effective, is likely to benefit considerably since doctors currently have nothing they can prescribe. Continues in the Subscriber's Area.

Long-term themes review October 29th 2018

Eoin Treacy's view
FullerTreacyMoney has a very varied group of people as subscribers. Some of you like to receive our views in written form, while others prefer the first-person experience of listening to the audio or watching daily videos.
The Big Picture Long-Term video, posted every Friday, is aimed squarely at anyone who does not have the time to read the daily commentary but wishes to gain some perspective on what we think the long-term outlook holds. However, I think it is also important to have a clear written record for where we lie in terms of the long-term themes we have identified, particularly as short-term market machinations influence perceptions.
Let me first set up the background; I believe we are in a secular bull market that will not peak for at least another decade and potentially twice that. However, it also worth considering that secular bull markets are occasionally punctuated by recessions and medium-term corrections which generally represent buying opportunities.

2018 has represented a loss of uptrend consistency for the S&P500 following a particularly impressive and persistent advance in 2016 and 2017. Many people are therefore asking whether this is a medium-term correction or a top. There is perhaps no more important question so let’s just focus on that for the moment. Continues in the Subscriber's Area.

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