Now that September is here, it’s back to business as usual, especially on Wall Street.
But something to chew on over the next few days is just how well the biotech sector has done. That sector rallied all last week, which helped to drive the Nasdaq to its first record close since July.
The iShares Nasdaq Biotech ETF IBB, +0.27% finished yesterday at its highest level since December 2015. For the week, the ETF is looking at a rise of more than 7%:
And among the individual names, Biogen BIIB, +2.06% marked its best close since July 2015 on Thursday:
That brings us to our call of the day from Daily Reckoning’s Greg Guenthner, who says now isn’t the time to bet against biotech, a sector that he says could produce the stock market’s leaders for the rest of the year.
Guenthner notes two catalysts that have helped fire up biotechs this week. The first is the buyout of Kite Pharma, by Gilead, which will get Kite’s new technology for harnessing the body’s immune system to fight cancer. The second is Novartis’s, gene therapy treatment for pediatric cancer scored FDA approval.
Others sound more cautious. T3Live’s Scott Redler was also pretty blown away by the performance of biotechs yesterday, but say he wouldn’t be “all-in long.”
Still, he says it isn’t wise to just short this area given how its stocks have powered through big resistance level.
Key market gauges
Ahead of the Labor Day weekend, Dow 22K is looking within reach as the blue-chip gauge DJIA, moves higher at the open, the S&P 500, and the Nasdaq Composite, are also up as investors shake off any jobs-data disappointment. Gold is also trucking higher post data, while the dollar is stumbling.