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TDR’s Top 5 Psychedelic Developments For The Week Of October 31

Welcome to TDR’s review of the Top 5 Psychedelic Developments for the week of October 31. Aside from presenting a synopsis of events, we provide market…

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Welcome to TDR’s review of the Top 5 Psychedelic Developments for the week of October 31. Aside from presenting a synopsis of events, we provide market commentary to summarize the week that was for publicly-listed companies.

5. MindMed Activist Investor Demands Federal Investigation To Probe Serious Allegations Of Misconduct

FCM MM HOLDINGS, LLC notified shareholders that it has formally filed a complaint with the Securities and Exchange Commission (SEC) and will file a referral to the Department of Justice regarding allegations against Mind Medicine Inc. The complaint focuses on the following allegations: self-dealing, lack of material disclosure, false statements/public statement fraud, and if the allegations are true, criminal activities by CEO Robert Barrow under Sarbanes-Oxley.

The complaint presents and analyses the allegations in the lawsuit Freeman v. Burbank et al. that MindMed’s intellectual property was mishandled due to a one-sided deal negotiated by Mr. Stephen Hurst, then MindMed’s CEO, and Mr. Carey Turnbull, CEO of Ceruvia Lifesciences LLC. It also lists Ceruvia executives who concurrently worked for MindMed during Messrs. Hurst and Barrow’s tenure and the implications for MindMed’s IP and trade secrets.

4. 90% Of U.S. Adults Say The Nation Is Experiencing Aa Mental Health Crisis, CNN/KFF Poll Finds

An overwhelming majority of people in the United States think the country is experiencing a mental health crisis, according to a new survey from CNN in partnership with the Kaiser Family Foundation.

Nine out of 10 adults said ​they believed that there’s a mental health crisis in the US today. Asked to rate the severity of six specific mental health concerns, Americans put the opioid epidemic near the top, with more than two-thirds of people identifying it as a crisis rather than merely a problem. More than half identified mental health issues among children and teenagers as a crisis, as well as severe mental illness in adults.

The survey captured the perceptions of a nationally representative sample of about 2,000 adults over the summer – 2½ years into the Covid-19 pandemic and amid ongoing public health threats including racism and gun violence.

___________

Latest Mainstream Poll On Colorado Proposition 122 Shows Increased Support Headed Into The November 8 Midterm Elections

Latest mainstream poll showsColorado Proposition 122oculd go down to the wire—Source: Poll: Legal mushrooms gaining momentum

___________

3. Psychedelic Stocks Decline To A Fresh Weekly All-Time Low

The psychedelic sector declines this past week, as reflected by the Horizon Psychedelic Stock Index (PSYK) ETF (4.94%) which made fresh all-time weekly lows. The ETF finished inline with the Nasdaq Junior Biotechnology Index (↓4.99%) and underperformed the Nasdaq Biotechnology Ishares ETF (↓1.03%). The NASDAQ 100 ↓6.11%and S&P 500 ↓3.46% as the Fed’s 75bp rate hike put a damper on risk asset buying.

Here’s how the Health Care (Biotechnology) sector performed:

In the news…

A clinic in Saskatoon is helping local residents access psychedelic drugs, joining groups across the country touting the therapeutic benefits of these once-prohibited substances.

Apex Labs Ltd. has received Health Canada’s approval to conduct the first North American take-home clinical trial evaluating the safety and efficacy of multiple low doses of self-administered oral synthetic psilocybin compound APEX-52 for the treatment of depression in veterans with PTSD.

Biomind Labs just hit a landmark on a trip that it hopes will take it all the way to market, posting new data that shows its inhaled psychedelic candidate aimed at helping patients with depression is safe and tolerable.

Braxia Scientific announced the voting results from its Annual General and Special Meeting of Shareholders held on Monday, October 31 2022. A total of 16.55% of the issued and outstanding common shares of the company were represented either in person or by proxy at the meeting.

Ceruvia Lifesciences announced the appointment of Stephen Hurst and David Steinberg to its Board of Directors, effective immediately.

Colorado could become 2nd state to decriminalize psychedelic mushrooms when voters go to the polls on November 8.

COMPASS Pathways reported its financial results for the third quarter 2022 and gave an update on recent progress across its business.

Crypto billionaire Brock Pierce joins psychedelic venture fund and says ‘potential reward is immeasurable’.

High Fusion has entered into a definitive arrangement agreement with Neural Therapeutics Inc. with respect to the distribution of a approximately one quarter of High Fusion’s shareholdings in Neural to High Fusion shareholders.

Irwin Naturals entered into a binding agreement on October 30, 2022, to acquire the assets of Clare Clinic, Inc., which operates three healthcare clinics in Florida.

LOVE Pharma gave an update from its investment in Starton Therapeutics Inc. as the company strengthens its board.

Loop Capital initiates coverage on atai Life Sciences with Buy Rating and $18 per share price target.

Lusaris Therapeutics, a company focused on creating next-generation serotonergic neuroplastogen psychedelic compounds to treat severe neuropsychiatric and neurological conditions, launched with a $60 million Series A financing. 

Meme Of The Week

Mind Medicine will host its earnings call on Thursday, November 10, 2022, at 8:30 a.m. EDT to discuss its financial results for the quarter ended September 30, 2022 and provide a business update.

PharmaTher Holdings announced it has entered into an evaluation and exclusive option agreement with Case Western Reserve University in the development and commercialization for the intellectual property of ketamine in the treatment Rett Syndrome, a rare genetic neurological disorder.

Psyched Wellness announced the successful production and delivery of its pre-orders of Calm in October, 2022. Calm has now shipped to customers in 37 different States throughout America. 

Revitalist Lifestyle & Wellness releases proprietary supplement lines to extend the results of psychedelic medicine outcomes.

Small Pharma has received approval from the U.K. Medicines and Healthcare products Regulatory Authority and the Research Ethics Committee to initiate a Phase I study of SPL028, its proprietary deuterated N, N-dimethyltryptamine (DMT) candidate, with supportive therapy in healthy volunteers. 

2. Congressman Predicts Colorado Psychedelics Legalization Initiative Will Pass Next Week, And The Trend Will ‘Continue’

A congressman says that he expects that Colorado voters will make history again next week by passing a ballot initiative to legalize the possession of certain psychedelics and create psilocybin therapy centers in the state.

Rep. Earl Blumenauer (D-OR) told Marijuana Moment late last month that he “absolutely” sees parallels between the movements to reform laws around psychedelics and marijuana. And in much the same way that Colorado was one of the first states to legalize cannabis for adult use in 2012, he predicts “you’re going to see passage” of Proposition 122 this year.

The congressman is well known for his marijuana reform advocacy on Capitol Hill, serving as a co-chair of the Congressional Cannabis Caucus. But he’s also become one of the most vocal members on psychedelics policy in recent years as his home state of Oregon has led the way in legalizing psilocybin services access and more broadly decriminalizing drug possession.

1. Severe Depression Eased By Single Dose Of Synthetic ‘Magic Mushroom

A single dose of a synthetic version of the mind-altering component of magic mushrooms, psilocybin, improved depression in people with a treatment-resistant form of the disease, a new study found.

The randomized, double-blind clinical trial, which authors called “the largest of its kind,” compared results of a 25-milligram dose to a 10-milligram and 1-milligram dose of a synthetic psilocybin, COMP360, that was administered in the presence of trained therapists.

Results of the study, published Wednesday in The New England Journal of Medicine, found “an immediate, fast, rapid-acting, sustained response to 25 milligrams (of COMP360),” said study coauthor Dr. Guy Goodwin, a professor emeritus of psychiatry at the University of Oxford in the United Kingdom.

The post TDR’s Top 5 Psychedelic Developments For The Week Of October 31 appeared first on The Dales Report.

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Stay Ahead of GDP: 3 Charts to Become a Smarter Trader

When concerns of a recession are front and center, investors tend to pay more attention to the Gross Domestic Product (GDP) report. The Q4 2022 GDP report…

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When concerns of a recession are front and center, investors tend to pay more attention to the Gross Domestic Product (GDP) report. The Q4 2022 GDP report showed the U.S. economy grew by 2.9% in the quarter, and Wall Street wasn't disappointed. The day the report was released, the market closed higher, with the Dow Jones Industrial Average ($DJIA) up 0.61%, the S&P 500 index ($SPX) up 1.1%, and the Nasdaq Composite ($COMPQ) up 1.76%. Consumer Discretionary, Technology, and Energy were the top-performing S&P sectors.

Add to the GDP report strong earnings from Tesla, Inc. (TSLA) and a mega announcement from Chevron Corp. (CVX)—raising dividends and a $75 billion buyback round—and you get a strong day in the stock markets.

Why is the GDP Report Important?

If a country's GDP is growing faster than expected, it could be a positive indication of economic strength. It means that consumer spending, business investment, and exports, among other factors, are going strong. But the GDP is just one indicator, and one indicator doesn't necessarily tell the whole story. It's a good idea to look at other indicators, such as the unemployment rate, inflation, and consumer sentiment, before making a conclusion.

Inflation appears to be cooling, but the labor market continues to be strong. The Fed has stated in many of its previous meetings that it'll be closely watching the labor market. So that'll be a sticky point as we get close to the next Fed meeting. Consumer spending is also strong, according to the GDP report. But that could have been because of increased auto sales and spending on services such as health care, personal care, and utilities. Retail sales released earlier in January indicated that holiday sales were lower.

There's a chance we could see retail sales slowing in Q1 2023 as some households run out of savings that were accumulated during the pandemic. This is something to keep an eye on going forward, as a slowdown in retail sales could mean increases in inventories. And this is something that could decrease economic activity.

Overall, the recent GDP report indicates the U.S. economy is strong, although some economists feel we'll probably see some downside in 2023, though not a recession. But the one drawback of the GDP report is that it's lagging. It comes out after the fact. Wouldn't it be great if you had known this ahead of time so you could position your trades to take advantage of the rally? While there's no way to know with 100% accuracy, there are ways to identify probable events.

3 Ways To Stay Ahead of the Curve

Instead of waiting for three months to get next quarter's GDP report, you can gauge the potential strength or weakness of the overall U.S. economy. Steven Sears, in his book The Indomitable Investor, suggested looking at these charts:

  • Copper prices
  • High-yield corporate bonds
  • Small-cap stocks

Copper: An Economic Indicator

You may not hear much about copper, but it's used in the manufacture of several goods and in construction. Given that manufacturing and construction make up a big chunk of economic activity, the red metal is more important than you may have thought. If you look at the chart of copper futures ($COPPER) you'll see that, in October 2022, the price of copper was trading sideways, but, in November, its price rose and trended quite a bit higher. This would have been an indication of a strengthening economy.

CHART 1: COPPER CONTINUOUS FUTURES CONTRACTS. Copper prices have been rising since November 2022. Chart source: StockCharts.com. For illustrative purposes only.

High-Yield Bonds: Risk On Indicator

The higher the risk, the higher the yield. That's the premise behind high-yield bonds. In short, companies that are leveraged, smaller, or just starting to grow may not have the solid balance sheets that more established companies are likely to have. If the economy slows down, investors are likely to sell the high-yield bonds and pick up the safer U.S. Treasury bonds.

Why the flight to safety? It's because when the economy is sluggish, the companies that issue the high-yield bonds tend to find it difficult to service their debts. When the economy is expanding, the opposite happens—they tend to perform better.

The chart below of the Dow Jones Corporate Bond Index ($DJCB) shows that, since the end of October 2022, the index trended higher. Similar to copper prices, high-yield corporate bond activity was also indicating economic expansion. You'll see similar action in charts of high-yield bond exchange-traded funds (ETFs) such as iShares iBoxx $ High Yield Corporate Bond ETF (HYG) and SPDR Barclays High Yield Bond ETF (JNK).

CHART 2: HIGH-YIELD BONDS TRENDING HIGHER. The Dow Jones Corporate Bond Index ($DJCB) has been trending higher since end of October 2022.Chart source: StockCharts.com. For illustrative purposes only.

Small-Cap Stocks: They're Sensitive

Pull up a chart of the iShares Russell 2000 ETF (IWM) and you'll see similar price action (see chart 3). Since mid-October, small-cap stocks (the Russell 2000 index is made up of 2000 small companies) have been moving higher.

CHART 3: SMALL-CAP STOCKS TRENDING HIGHER. When the economy is expanding, small-cap stocks trend higher.Chart source: StockCharts.com. For illustrative purposes only.

Three's Company

If all three of these indicators are showing strength, you can expect the GDP number to be strong. There are times when the GDP number may not impact the markets, but, when inflation is a problem and the Fed is trying to curb it by raising interest rates, the GDP number tends to impact the markets.

This scenario is likely to play out in 2023, so it would be worth your while to set up a GDP Tracker ChartList. Want a live link to the charts used in this article? They're all right here.


Jayanthi Gopalakrishnan

Director, Site Content

StockCharts.com

 

Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional.

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Hotels: Occupancy Rate Down 6.2% Compared to Same Week in 2019

From CoStar: STR: MLK Day Leads to Slightly Lower US Weekly Hotel PerformanceWith the Martin Luther King Jr. holiday, U.S. hotel performance came in slightly lower than the previous week, according to STR‘s latest data through Jan. 21.Jan. 15-21, 2023 …

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With the Martin Luther King Jr. holiday, U.S. hotel performance came in slightly lower than the previous week, according to STR‘s latest data through Jan. 21.

Jan. 15-21, 2023 (percentage change from comparable week in 2019*):

Occupancy: 54.2% (-6.2%)
• Average daily rate (ADR): $140.16 (+11.3%)
• evenue per available room (RevPAR): $75.97 (+4.4%)

*Due to the pandemic impact, STR is measuring recovery against comparable time periods from 2019. Year-over-year comparisons will once again become standard after Q1.
emphasis added
The following graph shows the seasonal pattern for the hotel occupancy rate using the four-week average.

Click on graph for larger image.

The red line is for 2023, black is 2020, blue is the median, and dashed light blue is for 2022.  Dashed purple is 2019 (STR is comparing to a strong year for hotels).

The 4-week average of the occupancy rate is below the median rate for the previous 20 years (Blue), but this is the slow season - and some of the early year weakness might be related to the timing of the report.

Note: Y-axis doesn't start at zero to better show the seasonal change.

The 4-week average of the occupancy rate will increase seasonally over the next few months.

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American Express Numbers Show What Still Gets People to Spend Money

American Express stock jumped nearly 12% since earnings dropped.

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American Express stock jumped nearly 12% since earnings dropped.

Even though American Express  (AXP) - Get Free Report earnings announced Friday afternoon fell somewhat short of expectations for the quarter, shares still soared to highs unseen for many months due to a number of strong metrics -- quarterly revenue growth of 17%, plans to raise its dividend by 15% from 52 to 60 cents and an annual revenue that surpassed $50 billion for the first time ever.

At $52.9 billion, the latter is driven primarily by an increase in quarterly member spending. Last year, that number was at $42.4 billion. 

According to American Express Chairman and CEO Stephen J. Squeri, the increase can be attributed to higher numbers of millennials gaining in earning power and using their AmEx above other cards to tap into rewards as many approach milestones like marriage, career advancement, and homeownership.

"Millennial and Gen Z customers continue to be the largest drivers of our growth, representing over 60% of proprietary consumer card acquisitions in the quarter and for the full year," Squeri said in an earnings call discussing the results.

People Are Using Their AmEx Cards a Lot

The $52.9 billion number is up 25% from what was seen last quarter and reflects a number of different factors also having to do with post-pandemic spending.

"We ended 2022 with record revenues, which grew 25% from a year earlier, and earnings per share of $9.85, both well above the guidance that we provided when we introduced our long-term growth plan at the start of last year, despite a mixed economic environment," Squeri said.

AmEx further reported that 12.5 million new members signed up for cards in 2022 while existing members used their cards frequently. Fourth-quarter sales at AmEx's U.S. consumer services and commercial segments rose by a respective 23% and 15%.

But higher expenses also led to falling below analyst expectations. The fourth-quarter income of $1.57 billion, or $2.07 a share, is down from $1.72 billion ($2.18 a share) in the fourth quarter of 2021. FactSet analysts had predicted $2.23 a share.

"I'm not sure what that's really a function of right now -- whether it's a function of the economy or of confusion on where to advertise right now," Squeri told Yahoo Finance in reference to lower spending on the part of small business and digital advertisers. "We're going to watch that, but the consumer is really strong, travel bookings are up over 50% vs pre-pandemic."

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It's a Good Time to Be Tracking Credit Card Companies

Immediately after the earnings dropped, AmEx stock started soaring and was up nearly 12% at $175.24 on Friday afternoon. This is a high unseen in months -- the last peak occurred when, on September 12, shares were at $162.45. 

Whether due to or despite analyst threats of a looming recession, people have been using their credit cards very actively throughout the end of 2022.

When it posted its earnings earlier this week, Mastercard  (MA) - Get Free Report surpassed Wall Street expectations of $5.8 billion and $2.65 per share in fourth-quarter earnings. Visa  (V) - Get Free Report also saw revenue rise 11.8% to $7.94 billion in the same quarter. The numbers also reflect higher numbers of people traveling and using their credit cards in different countries.

"Visa's performance in the first quarter of 2023 reflects stable domestic volumes and transactions and a continued recovery of cross-border travel," outgoing CEO Al Kelly said of the results during a call with financial analysts.

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