Stocks and Securities

U.S. stock futures are losing ground Monday, putting the Dow industrials [stock_quote symbol=”DJI”] on track for a fifth losing session in a row as trade-war fears continued to weigh on global markets. However, housing data due out at 10 a.m. eastern time may provide some support for the equity markets.

Oil traders will be waiting to see what the world’s most powerful oil producer Saudi Arabia does at June 22nd meeting of OPEC and non-OPEC members. With unplanned outages escalating, geopolitical risks rising, and U.S. shale production facing infrastructure bottlenecks, Saudi Arabia is in the driver’s seat exerting significant influence over the oil market. The meeting is expected to be dominated by arguments over whether to increase production or maintain supply as it is. Saudi Arabia and Russia are reportedly ready to increase oil output while others like Iran and Venezuela are against such a move and want to maintain supply at the current level. OPEC and a group of non-OPEC producers, including Russia, are currently adhering to a deal struck in November 2016 to curb oil production by about 1.8 million barrels a day in a bid to support prices. The strategy has worked with prices having risen from a low of $26 a barrel in January of 2016 to currently trade around $76 for Brent and $66 for West Texas Intermediate (WTI) . While the upcoming meeting may pressure oil prices over the next week or so, if the spread between Brent and WTI oil can remain above $8-$9 we would keep an eye on shares of domestic producers Occidental Petroleum (OXY) and Anadarko (APA) , especially on anticipated weakness.

 

Cryptocurrencies and Blockchain

In the world of crypto, the biggest news came last Friday when William Hinman, director of corporate finance for the U.S. Securities and Exchange Commission (SEC), told the audience that bitcoin and ether — the two currencies that make up the largest share of the crypto market — are not securities. The argument is based on what makes a security. One clear definition: a security has a centralized third party that benefits from its sale. Stocks are one example of a security. You buy stock in a company, and the company uses that money to fund its operations.

Bitcoin and ether are both decentralized — no one person or company stands to benefit from their sale. So it’s hard to argue that they fit the bill for a security. Bitcoin and ether might not be securities, but other cryptocurrencies, probably are particularly those funded via initial coin offerings (ICOs), as Hinman noted during his speech. In those cases, one centralized company markets and sells the assets (cryptocoins/tokens) and uses the money from the sale to fund their company. The sellers convince the buyers the assets will eventually be worth more than they are at the time of the sale. Until now, the cryptocurrency world has remained largely unregulated, but that’s changing.

Several governments are now taking a closer look at cryptocurrencies. The SEC, in particular, has show an increased interest. Cryptocurrency traders felt the speech was generally positive for the industry and could lead to more positive regulation for other alternative digital currencies like Ripple (XRP).

 

Stocks on the radar

Alnylam (ALNY)

Alnylam (ALNY)  will be presenting Phase 3 study of patisiran, an investigational RNAi therapeutic for the treatment of hereditary ATTR (hATTR) amyloidosis at the 4th Congress of the European Academy of Neurology (EAN), held June 16-19. Expect volume to pick up heading into the presentation.

 

Viking Therapeutics (VKTX)

Viking Therapeutics (VKTX)-The company’s clinical programs include VK5211, an orally available, non-steroidal selective androgen receptor modulator (SARM) in Phase 2 development for the treatment and prevention of lean body mass loss in patients who have undergone hip fracture surgery. VK2809, a small molecule thyroid beta agonist in Phase 2 development for the treatment of non-alcoholic fatty liver disease (NAFLD) and hypercholesterolemia. Viking is also developing novel and selective agonists of the thyroid beta receptor for glycogen storage disease type 1a (GSD 1a) and X-linked adrenoleukodystrophy (X-ALD), as well as programs targeting diabetes, metabolic diseases and anemia. They recently did a share offering to raise capital thus you can expect that to be out the way.