Market Morning: Gene Therapy Deregulation, Amazon to the Movies, SEC On Musk’s Tail

Futures Up on China-U.S. Trade Talks, China at New 52-Week Lows

Washington sent an invitation to Beijing for trade talks in late August, and the Chinese have responded in kind. They plan to send their vice minister of commerce to discuss the situation, and U.S. futures are up on the news. Not so much for China, whose Shanghai Composite Index (NYSEARCA:FXI) hit new 52-week lows overnight, but has bounced somewhat since. Could the U.S. be “winning” the trade war? Not that a few days of market activity are particularly indicative. S&P 500 futures (NYSERACA:SPY) are nevertheless up handily at 0.3% after falling over 20 points yesterday. Futures however can deceive, as they were up yesterday, too, only to fall precipitously at market open. Meanwhile, the Turkish Lira continues its recovery, now falling below 6 to the dollar as emerging markets step back from the cliff.

SEE: EU Mulls Regulations for ICOs

Gene Therapy Catches a Break from Regulators

Gene therapy, where genes are altered, turned off, or added in order to attack the root cause of genetic disease, caught a break from the National Institutes of Health yesterday as the agency has said it will not review candidates before passing jurisdiction along to the Food and Drug Administration. As it stands now, gene therapy candidates have to pass the NIH and the FDA, but according to the rule change, the NIH will now only serve an advisory role and the FDA will have the ultimate decision as it does in all other drug applications. More than 700 applications for new therapies are on the FDA’s desk, so the less redundancy in regulation, the faster these applications will go through. This has particular significance for the CAR-T space.

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Keystone Pipeline Comes Into Question

A federal judge in Montana has ordered a new review of the Keystone XL Pipeline, long a political sore point between environmentalists and the energy sector. The pipeline would go from Canada’s oil sands in Alberta down to Nebraska, and the judge has ordered a new review of the pipe route. President Obama had rejected the pipeline back in 2015, arguing it would “mostly” benefit Canadians, though trade is a mutually beneficial activity by definition. President Trump has embraced the pipeline, but now it looks like it will be delayed further. All things being equal, this is bullish for the price of oil (NYSEARCA:USO), since it will lower supply more than otherwise.

Amazon Is Going To The Movies? Could Be Soon

Amazon.com (NASDAQ:AMZN) is looking to acquire movie theater chain Landmark Theaters, currently backed by Mark Cuban. Talks are private and a deal has not been sealed yet. The chain was founded in 1974 and has about 50 theaters in New York, Chicago, Philadelphia, Los Angeles and San Francisco. Speculation is ripe that overpriced junk food concession stands would be stocked with overpriced healthy organic Whole Foods instead, to the delight of health enthusiasts and displeasure of Milk Duds fans. If the deal goes through it would be small compared to Amazon’s size, but it could mean cheaper movie ticket prices for Prime members, and Amazon taking over one more niche in the U.S. entertainment sector.

Musk Draws SEC Attention Over Tesla Tweet

The SEC is now “formally” looking into Tesla (NASDAQ:TSLA) CEO Elon Musk’s tweet about bringing Tesla private. Musk infamously claimed that he had “funding secured,” which now does not seem totally accurate. The tweet forced a massive short squeeze, and short sellers have sued the car company for stock manipulation. The SEC is investigating whether Musk intentionally misled investors in order to knock shorts off his stock, though in Musk’s opinion funding is all but certain from the Saudi Arabian sovereign wealth fund. This would signal another backdoor alliance between Israel and Saudi Arabia, Musk being Israeli. Perhaps if Tesla goes private, a giant explosion of peace will be set off in the Middle East, and the lion will lay down with the lamb and such.

 

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