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Technology building some gains

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The Biotechnology Index (BTK.X) 362 +2.3% is joining the Semiconductor Index (SOX.X) 329 +3%, Wireless Telecom (YLS.X) 54.58 +3% and Fiber Optic (FOP.X) 2.95% as a technology rally looks to extend itself.

While not a component of the Biotechnology Index (BTK.X), Alexion Pharmaceuticals (NASDAQ:ALXN) $15.05 +35.7%, which is engaged in the discovery and development of therapeutic products, trades higher after announcing that that both of its COMMA and COMPLY trials showed that pexelizumab did not reach its primary endpoint of infarct size reduction as measured at 72 hour, but that the COMMA trial, which was associated with a dose-dependent, did show a statistically significant 70% reduction in 90-day mortality.

Also bolstering bullishness in biotechs was today's news out of Medicines Company (NASDAQ:MDCO) $16.47 +29.6% and a break to a new 52-week high after the company reported this morning that all of the primary and secondary objectives for the landmark post- marketing REPLACE-2 clinical trial of Angiomax were met.

In a research note earlier this morning, Deutsche Securities says that a study of MDCO's Angiomax versus a combination of Heparin and a GP IIb/IIIa inhibitor (which is similar to MLNM's Integrilin) showed the Angiomax to be efficacious with certain heart procedures in certain patients, and reduced bleeding and was less expensive. Deutshe Securities said it is leaving estimates for Biotech Index (BTK.X) component Millennium Pharmaceuticals' (NASDAQ:MLNM) $8.34 +0.84% Integrilin unchanged, as that product is used in high risk patients, which Angiomax does not address as well. However, Deutsche says investors will take a cautious stance until the impact on Integrilin is known.

Some of today's news in these "smaller" biotechs are giving a boost to those smaller weighted stocks in the Biotech Index (BTK.X) with Affymetrix (NASDAQ:AFFX) $28.20 +4.9%, Protein Design Labs (NASDAQ:PDLI) $9.57 +4.7% and Vertex Pharmaceuticals (NASDAQ:VRTX) $17.88 +4.37% leading sector gains. More heavily weighted Amgen (NASDAQ:AMGN) $47.75 (unchanged) and Biogen (NASDAQ:BGEN) $41.34 are lagging today's move. Notable technicals do have Biogen (BGEN) breaking above its longer-term 200-day SMA of $40.87 today, while Amgen (AMGN) has been teetering on either side of its 200-day SMA the past month, but finds resistance today with its 200-day SMA just above $48.70.

The gains in telecom-related technology, semiconductor and some bullishness added in from the biotechs has the NASDAQ-100 Index (NDX.X) 1,070 +0.85% leading the major market index gains.

The Dow Industrials (INDU) 8,574 -0.05% is attempting to get back to the unchanged level and down just 4.4 points, weighed lower by AT&T (NYSE:T) $13.19 -4.8%, Wal-Mart (NYSE:WMT) $54.61 -1.6% and Citigroup (NYSE:C) $36.44 -1.2%.

The much broader S&P 500 Index (SPX.X) 910 (unchanged) has been either side of unchanged this morning, as tech gains are being offset by exposure in the financials, which have the S&P Banks Index (BIX.X) 282 -0.64%, KBW Bank Index (BKX.X) 758.44 -0.76% and Insurance (IUX.X) 271 -0.95% seeing marginal losses. The Securities Broker/Dealer Index (XBD.X) 434 +0.75% bucks financials weakness and just today looks to break above its longer-term 200-day SMA.

It has been a rather light volume session, with volume just approaching the 771 million share level on the NYSE Composite (NYA.X) 482 (unchanged), with the NASDAQ Composite (COMPX) 1,420 +0.67% adding 9 points on volume of 1 billion shares.

A quick look at breadth indicators has NYSE advancers with a slight edge over decliners at 17 to 14, while bulls have a slight breadth edge at the NASDAQ at 16 to 15.

Stocks hitting new highs versus their counterparts hitting new lows remains rather bullish as the big board shows 37 stocks trading new highs versus 27 stock hitting new lows, while NASDAQ is positive in this category with 51 stocks being pushed to new highs versus 33 stocks trading new lows.

Jeff Bailey

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