Five Stocks to Watch in June

The U.S. stock market made yet another record in May, with the S&P 500 Index making a new all-time high on May 23rd and closing the month just 0.46 shy of the record. Nevertheless, some analysts are seeing underlying weakness in that the S&P 500 stocks only traded 1.8 billion shares last month, the lowest number since 2008. The day the all-time high was made on May 23rd, only 20 of the 500 stocks reached new highs.

According to many analysts, when new highs in the market are made with decreasing breadth and lower volume, it generally indicates the beginning of a downward cycle. While market fundamentals show signs of weakening, the market has repeatedly proved naysayers wrong since the end of 2013. June promises to be an interesting month in the markets.

GlaxoSmithKline PLC (GSK) - The UK pharmaceutical giant just announced a deal with Adaptimmune, a biotech company for the development of an early stage cancer medication. This comes after the company reached a deal with Swiss pharmaceutical company Novartis AG (NVS) for its cancer drug division in a swap of over $20 billion in assets, the cancer division was sold for $16 billion. The deal announced with Adaptimmune is worth $350 million over 7 years and puts GlaxoSmithKline back in the cancer medication field.

Annie's Inc. (BNNY) - Annie's Inc. came out with earnings last week and the stock got hammered in the aftermarket and pre-market after the announcement Thursday afternoon. The reason for the sharp selloff was Annie's full year 2015 guidance, which failed to meet analyst expectations. Nevertheless, Annie's stock rallied during Friday's regular session, ending down only six percent after being down as much as 17 percent in the premarket. With the company set to release a new line of frozen food in August, Annie's is still growing, which could affect the stock in the near term. (JD) - After a successful IPO last month, pricing shares initially at $19, China's second largest B2C online retailer is currently trading over $25 per share. The success of this IPO is crucial to the upcoming Alibaba IPO; Alibaba is China's premiere website and is scheduled to have its IPO in the next few months. shares will benefit from a successful Alibaba IPO and is a strong player in the $180 billion market for consumer internet sales in China this year.

Intercept Pharmaceuticals Inc. (ICPT) - Last week, Intercept announced the FDA had granted Fast Track designation for the company's obeticholic acid, a treatment for primary biliary cirrhosis. The fast tracking news sent Intercept stock over $251 per share, but subsequently sold off and closed Friday at $236.61 per share. Intercept stock has had a very volatile year, trading as high as $497 per share in January, and as low as $30.73 per share last year.

DirecTV (DTV) - Last month, AT&T (T) made a bid for the cable operator offering $49 billion. Nevertheless, the deal is still subject to approval by regulators and is occurring roughly at the same time as Comcast's (CMCSA) bid for Time Warner Cable (TWC). DirecTV stock initially rallied to $92 per share after the deal was announced on May 13th, but has since drifted back down and closed at $82.44 on Friday. Both the Comcast and AT&T bids will be carefully examined by regulators and could cause either one or both deals to sour, which would in turn affect DirecTV stock.

Published on Jun 2, 2014
By Jay Hawk
Jay Hawk
Jay Hawk enjoyed a 12-year professional financial markets career incorporating extensive first hand futures and options experience obtained by trading in the stock, commodity and forex markets on U.S. exchanges. Since retiring as a full-time financial market professional, he has been actively trading stock, commodities, forex and options for his own account and managing funds for others, as well as writing financial market commentary and educational articles.

Copyrighted 2020. Content published with author's permission.

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