Record Low Volumes but Biotech Catching a Tailwind with Expectations of Rate Cuts

Equity markets started the home stretch into Labor Day with record low volume. 

Company specific news releases were limited, and policy direction seems clear after Powell’s dovish comments.  The March NFP was revised down by 818k making it the largest revision (upward or downward) since 2009.   The cooling labor market helped provide air cover for the Fed policy pivot with the chairman explicitly stating the time has arrived to adjust policy.  Traders will continue to debate the magnitude of adjustment expected in September and focus will increasingly turn to the election. 

Regulatory:

• Biogen (BIIB) announced a pyrrhic victory in the UK with approval of Alzheimer's therapy Leqembi, but rejection of reimbursement coverage by the National Institute for Health and Care Excellence (NICE) effectively blocking access to the drug in the National Health System (NHS).

Clinical:

• Galapagos (GLPG) announced FDA clearance of IND application for Phase 1/2 ATALANTA-1 study of autologous CD19 CAR-T construct GLPG5101 in relapsed/refractory non-Hodgkin lymphoma.  GLPG is using decentralized manufacturing aimed to bring the vein-to-vein time down to 7 days or less.

Corporate Updates and Earnings:

• Medtronic (MDT) reported topline (+0.3%) and EPS (+2.4%) ahead of the street and raised the low end of the guidance range to $5.42 from $5.40. 

Culling the Herd:

• Aadi Bioscience (AADI) announced the halt of the PRECISION1 trial for nab-sirolimus in solid tumors. The company will cut ~80% of R&D workforce.