Trading action continues to be extremely slow. The indices are close to flat, breadth is running 30-43 negative, and I only see about a dozen stocks that are up more than 10%
I believe this is the slowest the trading has been since before the COVID crisis hit in February 2020. There just isn't much energy out there right now, and it is unclear why. I suspect that retail traders lost some of their confidence as many of the hot themes and individual stocks have suffered, but there should have been some additional liquidity due to stimulus payments, but that doesn't seem to have mattered.
The recent rotational action and concerns about inflation shifted market sentiment, and that is probably the main thing that is impacting the action right. Sentiment is not negative but there just isn't the wild optimism that was driving some of the hot themes a couple of months ago.
We have the Fed minutes this afternoon that may trigger some discussion about inflation again, but it looks like many market participants are just biding their time as we await the start of earnings season. The economy is progressing very well, and that was priced to a large degree, but the lack of energy is puzzling and is making for a pretty boring market right now.
A couple of names I've mentioned lately continue to do well. Ammo (POWW) is chugging along, and Kopin (KOPN) is taking out some recent highs, however most of the names on my screens are just trading randomly.
One group that I'm watching closely now is biotechnology (IBB) . The sector has been a laggard since hitting a high on February 10. I see quite a few names that are looking washed out and are trying to find support after a sharp pullback. I'll list some of my favorites this afternoon.
One low-priced name I'm buying this morning is Baudax Biotech (BXRX) . They obtained FDA approval of their Anjeso drug that is used for postoperative pain just as the COVID crisis hit. It is non-opioid and non-steroid that is used in elective surgeries. Management made a number of missteps, but in an SEC filing they indicated that sales are now ramping up. It is a low-price speculative play but looks pretty washed out at these levels.
I'll have an update on a number of other biotechnology names later today.