Dreary economic data rolled in ahead of the Fed chair's afternoon speech
The Dow Jones Industrial Average (DJI) is modestly lower midday after a dismal batch of economic reports hit ahead of this afternoon's speech from Fed Chair Jerome Powell. Specifically, an S&P CoreLogic/Case Shiller report showed home prices rose at their slowest pace since August 2012, while separate data showed new home sales fell for a second straight month in May, and consumer confidence dropped to a lower-than-expected 121.5 in June, marking its weakest reading since September 2017. Traders are also keeping a cautious eye on geopolitical tensions between the U.S. and Iran, after President Donald Trump threatened "obliteration" on Twitter earlier.
Continue reading for more on today's market, including:
- The drug stock overdue for upgrades.
- Why Citi says it's time to buy GrubHub.
- Plus, a well-timed bullish options trade on Allergan; Krystal Biotech booms again; and FDA buzz sends Acer to the bottom of the Nasdaq.
Allergan plc (NYSE:AGN) is seeing unusual options activity today, with roughly 55,000 contracts traded so far, 13 times the average intraday amount. The August 135 and 165 calls are most active, due to some spreads that are possibly being closed for $22 apiece. According to Trade-Alert, some August 135/165 call spreads were bought to open last week for $3.45, meaning the speculator nabbed quick return of more than 500%. This brow-raising profit comes amid AGN stock's 26.6% surge today to trade at $164.08, sparked by news of AbbVie's (ABBV) $63 billion buyout of the Botox maker.
Krystal Biotech Inc (NASDAQ:KRYS) is a notable Nasdaq mover at midday, after the gene therapy specialist announced a new share offering and saw its price target hiked to $73 from $48 at Guggenheim. It's already been a big run for KRYS stock, which had its best day ever yesterday on positive trial data. Today, the shares are up 11.4% at $45.90, fresh off a record high of $46.90.
Acer Therapeutics Inc (NASDAQ:ACER) is at the bottom of the Nasdaq, after the Food and Drug Administration (FDA) failed to approve Edviso, the firm's treatment for the rare genetic disorder vascular Ehlers-Danlos syndrome (vEDS). The FDA is now requesting a clinical trial of the treatment. Needham's downgrade to "hold" from "buy" is only stoking the bearish flames, with ACER stock last seen down 77.6% at $4.32, earlier bottoming at a record low of $4.20.