An interesting week in the markets as the shooting of Donald Trump’s ear caused, at least at first, a continuation of the rally we had been seeing in small cap stocks. By the close Tuesday, the R2K had rallied for five straight days, gaining over 11%. An epic rally especially in light of the outperformance relative to the S&P 500 which gained a meager 1.5% over the same time.
Sadly, the euphoria faded on Wednesday and the TW universe took it on the chin. Volume dried up and, as the buyers retreated, small stocks were brought right back down. As I mentioned last weekend, all is not wonderful in the world and its very tough to see the market rallying broadly in this environment.
Where I do expect to see a continued rally, however, is in gold. I try not to repeat myself but every few weeks it bears mentioning that the Federal budget deficit is out of control. And, with Donald Trump likely to get elected, we are looking at increased spending on defense and, most likely, some form of tax cuts (or just continuing his previous cuts), all of which likely means even larger deficits.
Providing further future impetus to gold if Trump does win, is his desire to rein in the USD. Gold and the dollar tend to have an inverse relationship and if Trump does indeed weaken the greenback, that should provide a further boost to the yellow metal.
Unsurprisingly, gold hit multi-year highs last week. I believe this trend is set to continue and possibly accelerate. Most institutions and governments are underweight gold and, once they start playing catchup, things could get very interesting.
Cassava (SAVA) had another rough week as their chairman and CEO, Remi Barbier, abruptly resigned from the company. Is this the final nail in the coffin for SAVA? As someone who has been negative on the company for a long time, I’m inclined to lean in that direction.
However…….
Taking on the role of Chairman is Rick Barry. Rick is a very accomplished individual who was greatly responsible for the success of Sarepta (SRPT) and then followed that up with a stint turning MiMedx (MDXG) around. He is someone I know personally and hold in the highest regard. As such, I’m intrigued to see what will happen at SAVA. With Rick in charge, things could get very interesting.
Anixa (ANIX) has been acting great of late. Yes, I did say it was my top 2nd half pick but that’s just good timing. What’s more responsible for the move is the understanding that their CAR-T trial is progressing well. Management has been vocal in stating that they have seen initial signals of efficacy and the street should be getting some information soon.
Meanwhile, management has continued to buy stock in the open market and now the company has announced a $5M share repurchase program. Between the insider buys and a stock buyback, one would have to assume there’s a high degree of confidence here.
I continue to think Anixa will be publishing positive data in Q3 and, if I’m right on that count, could be in line for a partnership before the end of the year.
We are having a Zoom call with Dyadic (DYAI) this coming Wednesday. I keep hearing good things about what’s going on there. Looking forward to catching up with them and refreshing the story.
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