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Commodities Fell, XBI Was the Weaker Biotech ETF

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XBI was weaker

The markets were weaker for the week ending December 11, 2015. The weakness in the market was mainly due to the fall in commodities, especially oil. Oil breached and traded below $40 at the beginning of the week. It lost more ground and ended at $35.60. The biotech stocks were hammered. For the week, most of the biotech stocks and ETFs were in the red.

The SPDR S&P Biotech ETF (XBI) was the worst ETF. It had a return of -6.5%. The iShares US Healthcare Providers ETF (IHF) was a better performing ETF. It had a return of -1.9%. XBI closed at $65.73. It was trading 8.9% lower than the 100-day moving average price of $72.14. It was trading 5.8% lower than the 20-day moving average. XBI’s average trading volume for the week was ~3.8 million shares per day.

The above graph shows the performances of different biotech ETFs for the week ending December 11, 2015.

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Leaders and laggards

Insys Therapeutics (INSY) was the best performer for the week. It rose by 7.2%. The stock rose due to good buying support. It rebounded from the previous week’s low of $26.06. For the week, the stock’s average trading volume was ~837,000 shares per day. The stock’s book value is $3.29 per share. With its current value, the stock is being traded at a PBV (price-to-book value) ratio of 8.74x. Insys has a weight of 0.35 in the iShares Nasdaq Biotechnology ETF (IBB) and 0.9% in XBI. The other stocks that performed well were Alexion Pharmaceuticals (ALXN). It had returns of 7% during the week.

The biggest laggard for the week was Bluebird Bio (BLUE). It had a return of -28.9%. The stock fell due to disappointing clinical data for its BB305 treatment. Bluebird Bio closed at $59.52. With a book value of $24.26 per share, the stock is trading at a PBV ratio of 2.45x. It has a weight of 0.66% in XBI and 0.45% in IBB.

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