As of noon New York time today the Standard & Poor’s 500 was up 1.58% and the Dow Jones Industrials had gained 1.37%. The NASDAQ Composite was higher by 2.01% and the Russell 2000 small cap index had picked up 2.11%. The iShares MSCI Emerging Markets ETF (EEM) had climbed 1.53%.
At the close the S&P was ahead 1.27% and the Dow had gained 1.18%. The NASDAQ 100 had climbed 1.72% and the NASDAQ Composite was up 1.87.
But all those gains were dwarfed by the 5.22% pick up in the iShares NASDAQ Biotechnology ETF (IBB) as of noon. The ETF ended the day up 5.42%
As much as the deal news–that Nvidia (NVDA) would acquire chip designer Arm Holding (ARM) for $40 billion–has moved technology stocks and the general market, vaccine and other coronavirus news has rocketed the biotech sector even higher.
Last week ended with AstraZeneca (AZN) announcing that it had resumed its Phase 3 trial of a coronavirus vaccine candidate in the U.K. and Pfizer (PFE) reporting that it had asked for permission to increase the size of its Phase 3 trial to 44,000 from 30,00. Pfizer and its partner BioNTech (BNTX) said they expect to have a “conclusive readout on efficacy” by the end of October. (Note: efficacy is only one crucial endpoint of Phase 3 trials. The other is safety, which can take longer.)
Today Eli Lilly (LLY) and Incyte (INCY) have reported that their drug baricitinib in combination with Gilead Sciences’ (GILD) remdesivir, the leading treatment for coronavirus patients, had reduced hospitalization times for coronavirus patients better than those treated with remdesivir alone. (Shares of Incyte were up 5.85% as of the closed in New York.)
And the biotech sector had its own big deal news with Merck (MRK) announcing that it would buy $1 billion in stock in Seattle Genetics (SGEN) and pay as much as $4.5 billion to collaborate with Seattle Genetics on two cancer drugs. Gilead Sciences, meanwhile, reported that it would acquire cancer specialist Immunomedics (IMMU) for $21 billion. Seattle Genetics finished ahead 14.55% and Immunomedics was up 97.99% as of the close in New York.
That news led other biotech stocks higher–even if they didn’t have any coronavirus or deal news to report. Sangamo (SGMO), for example, was up 7.18%. Acadia Pharmaceuticals (ACAD) gained 5.43%.
And if you had a strong connection to a potential coronavirus vaccine? Vaxart (VXRT), a company developing a vaccine in pill form, saw its stock rebound by 46.79%. (I’ll have more on Vaxart in a later post.)