U.S. stocks posted broad declines yesterday as investors grew cautious in the wake of Fed Chairman Jay Powell’s Wednesday comments on the economy and a weaker than expected jobless claims report. The S&P 500 declined 0.8% while the Nasdaq tumbled 1.2% and the Dow fell 0.4%.
Asian stocks were mixed overnight, but the Chinese Shanghai Composite rallied 2.0% while Japan’s Nikkei 225 posted only modest gains. In Europe, markets are also mixed, and the Eurozone Stoxx 600 is just about flat.
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Today could be a choppy trading day for the market. An array of U.S. stock futures and options contracts are set to simultaneously expire today in a phenomenon know as ‘quadruple witching’, and it’s expected to create some volatility.
Futures look shaky in the pre-market, so there’s a good chance the market will open the day lower. However, anything can happen after the opening bell.
No notable earnings reports are on the docket for today.
It appears the White House wasn’t satisfied with Oracle’s (ORCL) TikTok deal. Officials say President Trump will block U.S. downloads of TikTok and WeChat starting Sunday. ORCL is currently down 1.4% in the pre-market.
Here’s what’s moving the market this morning:
Pivotal Investment Corporation II [PIC]
This special purpose acquisition company (SPAC), also known as a blank check firm, is rallying today on news that it will take vehicle electrification company XL Fleet public through a reverse merger. The combined enterprise value of the combined companies comes out to about $1 billion, and the deal is expected to close in the fourth quarter.
XL Fleet develops products that help companies change their gas-powered vehicles into hybrid and plug-in hybrid electric vehicles. They also offer data monitoring and analytics services.
SPAC stocks are killing it this year, and this is just the latest in a long series of winners. PIC is trading actively in the pre-market and it’s currently up 16.5%.
Immutep Ltd. [IMMP]
This tiny biotech stock is making some noise in the market today after the firm released positive interim data for its clinical-phase cancer treatment. The data indicates the Phase-2 study of eftilagimod alpha in combination with Keytruda in patients with 2nd line head and neck squamous cell carcinoma or non-small cell lung cancer is proceeding well.
So far, the treatment has been found to be safe and well-tolerated among patients. The firm expects to report first data from Stage 2 and more Stage 1 data later this year.
This was only an interim data release and it didn’t include a lot of information on the efficacy of the treatment. However, the news was enough to get investors charged up because shares are rallying. After all, this company only has a $6 million market cap so it doesn’t take much to get share prices moving.
IMMP is one of this morning’s most active stocks and it’s currently up 21.8%.
J. Alexander Holdings (JAX)
J. Alexander holdings had a tough time during the pandemic lockdowns, but it looks like it will emerge from the economic disaster in one piece. The restaurant holding company announced yesterday that it expects to have a positive cash flow or break even by the fourth quarter.
The firm also reported strong sales growth through the first three weeks of September. MTD sales volumes are roughly 90% higher than they were during the same period in 2019. The company is also seeing steady guest count recovery and increasing sales across its restaurant base.
This micro-cap restaurant stock could be a good value. It was trading for $10 per share before the pandemic, so there is a lot of potential upside if it makes a full recovery. JAX is p 11.9% in the after-hours trading session on news of the improving outlook.
Cassava Sciences (SAVA)
An effective treatment for Alzheimer’s is the pharma sector’s holy grail, and Cassava Sciences has a clinical-phase drug candidate that could take home the prize. The company announced earlier in the week that a Phase-2b study of sumifilam improved an entire panel of validated biomarkers in patient’s with Alzheimer’s.
The National Institutes of Health-backed study found Alzheimer’s patients treated with 50 mg to 100 mg of the drug for 28 days achieved statistically significant improvements in disease pathology biomarkers, neurodegeneration, and neuroinflammation in comparison with placebo.
Shares more than doubled when the news fist broke but, later in the week, SAVA sold off to give back a large chunk of those gains. However, SAVA is back at it again today. The stock is up 27.9% in the pre-market.