The new trading week started on the same bearish foot it ended the prior week on. When all was said and done, the S&P 500 ended the session at 2126.50, down 0.30%, and within sight of a major support level.
These three names led the bearish charge.
LendingClub Corp (LC)
It was already in trouble, with its stock losing nearly 10% of its value last week. LendingClub started the new trading week out in even worse shape than it ended the previous one, however, with LC shares giving up another 7.2% of their value on Monday.
The prompt for the pullback from LC isn’t new. That is, a string of worsening delinquency and other problems has forced the online lender to start charging higher interest rates in addition to raising the bar for borrowers. Both will crimp lending activity, and as a result, crimp sales and earnings.
Fanning the bearish flames that burned LC investors today was Friday’s news that Goldman Sachs Group Inc (NYSE:GS) has finally launched its own online-lending platform — called Marcus — posing a serious threat to LendingClub’s business. And unlike LendingClub, Goldman Sachs won’t rely on third-party funding. It will tap into its own deposits.
PTC Therapeutics, Inc. (PTCT)
As the old saying goes, if you live by the sword, you die by the sword. Within the world of biotech, the premise applies to stocks that rally based solely on expectations of a key Food and Drug Administration approval, only to be up-ended with that approval doesn’t pan out.
PTC Therapeutics once again illustrated the dangers of making such a gamble, with PTCT falling 40% on the heels of news that the FDA rejected the second requested consideration of its Duchenne muscular dystrophy drug Translarn.
The rejection wasn’t an outright rejection of the drug. Rather, the FDA simply said the initial filing information wasn’t complete. PTC Therapeutics was unwilling or unable to provide the balance of the FDA-requested information though, and asked the agency to accept the NDA anyway. The agency said no.
Although PTC Therapeutics can again appeal the decision, at this point, things don’t look good for PTCT owners.
Devon Energy Corp (DVN)
Last but not least, Devon Energy used more than its fair share of red ink on Monday on the heels of tumbling oil prices. Crude fell 0.8% to close at a price near $50.30 per barrel, sending DVN shares down 3% in response.
Devon Energy was hardly alone in its weakness, however. Peers and rivals Marathon Oil Corporation (NYSE:MRO) and Hess Corp. (NYSE:HES) along with most other energy stocks lost quite a bit of ground today.
The driver for oil’s setback was last week’s slight rise in the Baker-Hughes rig count number and concerns that some Organization of the Petroleum Exporting Countries members may not actually cut production as much as has recently been suggested.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.