Second Stimulus hopes and US-China Tensions are the two important factors that can make or break the coronavirus stock market rally. Novavax stock went wild on vaccine data news. A filing with the SEC shows that on May 12 Elizabeth Nabel also sold 30,000 shares of Moderna stock worth $1.98 million. Eastman Kodak Co.’s share price rally after news of a $765 million government loan to help it make drug ingredients at its U.S. factories has offered… Virginia’s offshore wind energy project could mean great things for workers if the commonwealth invests in their development and training, Eileen Woll of the Sierra Club Virginia Chapter writes in a guest column.
Wall street sign in New York with American flags and New York Stock Exchange background
The S&P 500 and Dow Jones industrial average futures maintain their gains for this week and trade higher today. Investors are quite hopeful about the progress being made for the second stimulus package.
There is also a tone of caution among investors in terms of buying stocks because of the review of the phase-one trade deal between the U.S. and China.
Meanwhile, the gold price has smashed another record high.
Stock futures are likely to remain sensitive to any stimulus-related news. There is no doubt that the U.S. economy needs more help, as the economic data is clearly showing that the recovery is stalling. However, the coronavirus stock market rally is still holding on to its gains, but the fuel seems to be running out. Another stimulus package could provide more fuel, and the U.S. stocks could make another record high.
Republicans and Democrats are under pressure to resolve their differences over another coronavirus aid package. Steven Mnuchin, the U.S. Treasury Secretary, has indicated that a deal can be reached by the end of this week, and this is keeping the hopes alive among investors.
Donald Trump needs to make sure that he sends one clear message: he is the toughest U.S. president for China. He doesn’t care about the cost of this message. What matters for him is that the U.S. elections are around the corner, and Americans should know that he will not bow to China.
The U.S.-China phase-one trade deal, which took nearly a year, is set to be reviewed during this month. The trade negotiators from both sides will be joining this meeting, and the progress of the deal will be reviewed. China pledged to increase its purchase of U.S. goods by $200 billion from its 2017 level.
However, coronavirus has clearly made an impact on the purchase, and China is running behind by nearly $77 billion in purchases. The import of agriculture goods, something that Donald Trump was most proud of and something that helped him to become more popular among farmers, is lagging the most.
The global coronavirus tracker shows more than 18.4 million cases and over 699,000 people have lost their lives due to this virus. According to state health department data, the positive coronavirus rate in Texas climbed for the third consecutive day. In Houston, the hospitalization rate continues to decline.
Vaccine news is still bringing enormous volatility for pharmaceutical stocks. Novavax stock surged, and shares went wild after its vaccine data was released.
Novavax stock declined nearly 34% in aftermarket trading before it pared some of its losses. The experimental Covid-19 drug has pushed the stock up by almost 3,800% this year.
The Dow futures are likely to face higher volatility as we get two critical economic readings. Firstly, it is the ADP Non-Farm Employment Change data, a data set that usually sets the tone for the US NFP.
A reading that is better than the forecast is likely to stimulate a stock rally, and any disappointment may result in profit-taking. The forecast is 1.2 million, while the previous reading was for 2.3 million.
The other relevant economic data is the ISM- Non-Manufacturing PMI number that is likely to shake the S&P 500 futures. The forecast is for 55, while the previous reading was at 57.1.
Gold Prices Made Another Record High
The yellow metal, gold, recorded another record high today. The gold price climbed to $2031 per ounce and then retraced to the 2,022 level at the time of writing this report. The path of the least resistance for gold is still skewed to the upside, and there is enough momentum that can push the gold price toward the $2,500.
Author: Naeem Aslam
Brigham president had sold more Moderna stock before she resigned from biotech’s board – The Boston Globe
But a filing with the Securities and Exchange Commission shows that on May 12 Nabel also sold 30,000 shares of Moderna stock worth $1.98 million.
The sales have infuriated a number of Brigham and Women’s employees, who point out that Nabel and other hospital administrators imposed budget cuts as she was benefiting from the stock sales. In a June 17 letter e-mailed to the employees, Nabel said the hospital’s parent company, Mass General Brigham, was cutting or freezing the salaries of employees and suspending contributions to their retirement benefits because of the “stark financial reality” confronting the hospital as a result of the pandemic.
“I know we will endure and emerge stronger and better than ever,” Nabel wrote Brigham employees.
On Tuesday, John Fish, the chairman of the hospital’s board of trustees and chief executive of the Suffolk construction company, declined to comment on whether Nabel should have sold millions of dollars in stock around the same time the hospital was cutting employees’ compensation. A spokesman for Dr. Anne Klibanski, chief executive of Brigham’s parent company Mass General Brigham, and a spokeswoman for Brigham and Women’s also declined to address the timing of the stock sales.
After Nabel announced her resignation from the Moderna board on Thursday, the Globe asked whether she intended to keep the $6.5 million from her July 15 stock sale. Erin McDonough, the hospital spokeswoman, said, “Dr. Nabel is considering a number of options, including charitable contributions.”
As of Tuesday, however, Nabel appeared to still be considering what to do with the money. “Dr. Nabel will make a charitable contribution to a non-profit charity of her choice” when she sells the rest of her investments in Moderna, the Brigham spokeswoman said in a statement.
Nabel had served on Moderna’s board since 2015. She still has 109,237 options to buy Moderna stock at a predetermined price, according the hospital. She received $425,000 in stock option awards from Moderna last year, as well as $62,500 in payment, according to an SEC filing.
Moderna’s share price has jumped this year amid widespread coverage of its effort to develop the first vaccine for COVID-19.
“The Brigham board and Dr. Nabel have agreed that she will pursue a plan of divestiture of her financial interest in Moderna as soon as possible,” the hospital said in its statement Tuesday.
Under SEC rules, McDonough said, Nabel has to wait until the next “open trading window” before she can sell stock options she obtained as a Moderna board member.
As long as Nabel retains those remaining shares, she still has a potential conflict of interest, according to Sunita Sah, a professor of management studies at Cambridge University in England and Cornell University who is considered an expert on such conflicts.
Sah said Nabel’s actions have implications for other Brigham employees.
“The hospital president sets the tone on conflicts of interest in general,” she said.
Medical ethics experts said last week that it was worrisome that the head of the Harvard-affiliated teaching hospital had a major financial stake in the vaccine, particularly given that many people are already skeptical of vaccines. Recent public opinion polls show up to half of Americans would be reluctant to get a COVID-19 vaccine if one is approved. To give people another reason to doubt a vaccine could be dangerous, the experts said.
Fish said in a statement Tuesday that although Brigham trustees had approved Nabel’s position on Moderna’s board and concluded she followed all requirements, “we fully support Dr. Nabel’s decision to step down from the Moderna board and divest her financial interests.”
Nabel continues to serve on the board of directors of a multinational medical technology company, Medtronic, a position she has held since 2014. Last year Medtronic paid her more than $407,000 while the firm did business with her hospital, according to a database maintained by the Centers for Medicare & Medicaid Services.
However, McDonough said Nabel’s actual compensation from Medtronic was $264,000. Nabel, she said, never saw the remaining $143,000, which paid for flights to Dublin, where Medtronic has its headquarters, lodging, and other expenses.
McDonough, the Brigham and Women’s spokeswoman, said Nabel’s involvement with Medtronic was governed by the Mass General Brigham Professional Institutional Conduct Committee, which requires she recuse herself from discussions about business between the firm and her hospital.
The Globe reported last year that as Brigham’s president, Nabel received about $2.6 million in total compensation in 2017.
This is not the the first time that Nabel’s multiple roles have raised concerns.
In 2016, a congressional committee report said she was part of a National Football League effort to “steer funding” for a landmark concussion study away from a group of respected brain researchers at Boston University who have helped to establish a link between football and chronic traumatic encephalopathy, long-term brain damage.
The report found that the NFL “inappropriately attempted to influence” the NIH’s grant selection process through Nabel, who was serving as the league’s chief health and medical adviser. Nabel knows NIH well, having directed its National Heart, Lung, and Blood Institute from 2005 to 2009. When the report was issued, she said she “had no intention of influencing” the NIH process. The agency stuck with its decision to award the grant to BU researchers, but ended up using internal funds, not NFL money, to pay for it.
Nabel, a cardiologist and professor at Harvard Medical School, stopped working as the health adviser to the NFL in 2017, according to Brigham’s spokeswoman.
Dr. Lindsey Baden, an infectious diseases specialist, is running the vaccine trial at the hospital and serves as one of three co-principal investigators for the study nationwide. Before Nabel resigned, he told the Globe she would play no role in the trial, which is expected to start soon at the hospital. He said he planned to report the results to Moderna, the National Institute of Allergy and Infectious Diseases ― which helped develop the experimental vaccine ― and the Biomedical Advanced Research and Development Authority.
Nabel’s recent sales of Moderna stock weren’t the first by company insiders to draw public attention.
Several Moderna executives and board members have sold millions of dollars worth of stock, including chief executive officer Stephane Bancel and chief medical officer Tal Zaks. Some trades were preprogrammed, company officials have said. But critics have questioned whether the insiders may have gained an unfair trading advantage by timing transactions with the release of market-moving data on the experimental vaccine’s progress.
Jonathan Saltzman can be reached at firstname.lastname@example.org
Kodak shareholders were not the only beneficiaries of the sudden stock surge — holders of convertible bonds also saw tidy gains
The sharp rally in Eastman Kodak Co.’s share price after news last week of a $765 million government loan to help it make drug ingredients at U.S. factories has offered shareholders and executives with stock options a tidy windfall.
Those notes were issued with a strike price of $3.175 per converted share. The stock closed at $33.20 on July 29, meaning the notes were worth just under $900 million. The stock has fallen 60% since then.
The notes were originally sold to funds managed by Southeastern Asset Management Inc., an employee-owned investment firm based in Memphis, Tenn. That company is Kodak’s biggest shareholder, with an 11.3% stake, equal to 4.96 million shares, according to FactSet data.
The notes were held by Southeastern’s Longleaf Partners Small-Cap Fund; C2W Partners Master Fund Limited, which is operated by Additive Advisory and Capital LLC; and Deseret Mutual Pension Trust, according to a regulatory filing.
See:Kodak’s stock triples as company announces pandemic plan to start making pharmaceutical ingredients
Southeastern Asset Management and Kodak did not respond to requests for information on the bonds. The SEC declined to comment on the movement in Kodak’s share price.
But the SEC has launched an investigation of the trading in Kodak’s shares before and after the news of the loan broke, the Wall Street Journal reported Tuesday, citing people familiar with the matter.
The loan news caused Kodak’s shares to climb to as high as $60 at their peak last week, before falling back to $15 on Monday, in massive trading volume that far exceeded the stock’s longer-term average daily turnover.
See also: Kodak’s stock surge turned executive options into huge potential payday
The stock had already moved 25% the day before the news was officially disclosed. Executives with stock options, including some awarded just a day before the loan became public, were sitting on big paper gains.
Kodak had shared information on the loan with a few media outlets before the public announcement, according to media reports. Some had published that information before they were asked to delete it and respect an agreed-upon news embargo.
Kodak’s shares had mostly languished since the pioneering photography company emerged from bankruptcy in 2012. The company, a member of the blue-chip Dow Jones Industrial Average as recently as 2004, has made several efforts to reinvent itself and enjoyed a brief stock rally in 2018 after announcing plans to get in on the blockchain and cryptocurrency craze.
News of the SEC probe came after Sen. Elizabeth Warren, a Democrat from Massachusetts, wrote an open letter to SEC Chairman Jay Clayton urging his agency to investigate “potential incidents of insider trading prior to the July 28, 2020, public announcement of the Trump administration’s $765 million loan to Eastman Kodak Co. (Kodak) to support the production of generic drug ingredients in response to the coronavirus disease 2019 (COVID-19) pandemic.”
Author: Ciara Linnane, Tomi Kilgore, MarketWatch , Joy Wiltermuth
Opinion: Workforce investment key to wind power project’s success
Virginia Gov. Ralph Northam, center, is photographed by the media as he looks over one of two offshore wind turbines off the coast of Virginia Beach, Va., Monday, June 29, 2020. Two wind turbines have been constructed 20 miles off the coast of Virginia Beach as part of an offshore wind turbine project. The turbines will begin operation in August. (AP Photo/Steve Helber) (Steve Helber/AP)
Eileen Woll, director, Sierra Club Offshore Energy Program
In June, Virginia became the first state in the nation to stand offshore wind turbines in federal waters. And with its larger adjacent Coastal Virginia Offshore Wind project, Virginia is in line to be home to the nation’s largest project — bringing 2,600 megawatts of offshore wind energy by 2026, enough to power more than 650,000 homes.
Virginia must now ensure that offshore wind is done right — meaning it is brought online in a way that is fair, equitable and beneficial for all Virginia communities.
According to the Virginia Department of Health, almost 900,000 Virginia residents live below the federal poverty threshold. With offshore wind, Virginia can help confront income inequality by creating more and higher paying jobs for its residents.
Researchers estimate that a full build-out of the offshore wind industry can create more than 14,000 jobs in Virginia. These are high-paying, local, career-length jobs that can employ a broad swath of Virginians, from high school and college grads to returning citizens, veterans transitioning to the civilian workforce, residents in low-income communities and workers transitioning out of careers devastated by COVID-19.
In addition to tremendous, wealth-building job opportunities, constructing offshore wind turbines with American parts and labor will also bring significant cost savings. Globally, costs have plunged 32% in the past year, and industry experts anticipate even further price drops as the United States builds its own manufacturing and supply chain instead of importing European parts.
The 2020 Virginia Clean Economy Act mandates that 5200 MW of offshore wind be constructed and delivered to the grid by 2035. The Virginia project represents half of that. The remaining 2,600 MW could manifest by leasing additional wind energy areas off Virginia’s coast and/or from the Kitty Hawk offshore wind project. Avangrid Renewables will start building this North Carolina project in 2025 and deliver that power into the grid through Virginia.
This sizable commitment helps position the commonwealth to become an offshore wind hub for the industry, serving not only Virginia and North Carolina, but also projects in northeastern states where more than 25 gigawatts of power — enough to power more than 15 million homes — are in the planning pipeline by 2030.
Indeed, this commitment has already prompted Siemens Gamesa, the world’s largest offshore wind turbine manufacturer, to announce interest in locating its U.S. manufacturing facility in Virginia.
To potentially seal the deal with them, or any other offshore wind manufacturer or developer, and to capture the job-creating and cost-saving benefits of offshore wind development, a robust and diverse workforce in Virginia must be readied.
Our Hampton Roads community must quickly come together, craft and implement a workforce development plan, and promote and expand on the plethora of already existing training and educational programs establishing that readiness. To ensure the build out is equitable, we must ensure that the job training and educational programs are accessible to people of color from low-income neighborhoods in our region.
The asset list selling Hampton Roads as the ideal place for offshore wind is extensive: deep-water harbor, no restrictions to vessel heights, the nation’s largest shipbuilding industry, port infrastructure, a robust network of community colleges and world-class universities, just to name a few. But tops on that list is the large coalition of offshore wind supporters that have been working together since 2009 to iron out the conflicts and to make it happen for Virginia.
With so much accomplished, we must now turn our attention to publicizing the job opportunities and getting Virginians into the educational and training programs ASAP. Otherwise we risk losing these wealth-creating job opportunities to other states.
Perhaps it was due to its infancy, but offshore wind survived COVID-19. Offshore wind can also be a solution to COVID-19, but we only do so by putting people power into the equation. Let’s make a plan, Virginia.
Eileen Woll is the Offshore Energy Program Director of the Sierra Club Virginia Chapter, located in Norfolk.
Recommended on The Virginian-Pilot
Author: Eileen Woll