2 Biotechs That Could Flex Their Muscles

Yesterday, I opined on my increasing caution on what has been a bifurcated market.  Stocks promptly sprinted to their best daily showing in four months. Even some high-beta areas of the market that have been under pressure over the past month had big days. Small-caps saw a rebound of better than 1%. Biotech advanced nearly 2% on the day. Today, futures are underwater thanks to increased worries about a possible and approaching government shutdown.

Yesterday's action did nothing to change my view on the overall market. I continue to believe equities at current trading levels are at least fully valued if not slightly overvalued. That does not mean there are not pockets of value in the current market. I continue to like the small biotech and biopharma arenas. The main biotech indices are still down almost 25% from their last peak over two years ago, while the overall market has had a nice advance over that time frame. New leadership at the Food and Drug Administration (FDA) is pushing hard to increase competition in the generics markets by focusing on streamlining the drug development and approval process. This should be good news for most of the industry....358 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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