However, Vertex reduced their percentage of improved patients, from 45% down to 35%, marking a significant loss in patient improvement. In addition, Vertex said the trial showed 19% of patients experienced a 10 percentage point improvement or more, below the 30% it had first seen. Vertex shares remain above their price of $37.41, where they were trading when the company originally reported the data on May 7.

Chairman and Chief Executive Jeffrey Leiden told analysts on a conference call that the discrepancy stemmed from a misinterpretation of data provided by an unidentified third-party vendor. Vertex’s earlier release judged patients’ relative improvement rates compared with a placebo rather than reporting improvements on an absolute basis. Leiden called the misstep “disappointing” but said final data from the combination’s Phase II study, slated for release mid-year, “will trump all of this.” With aims of treating a broader population of cystic-fibrosis patients, Vertex conducted the midstage trial of its approved drug Kalydeco and an experimental drug, VX-809, in adults with two copies of the most common mutation in a gene dubbed F508del. While the lower report has caused the stock price to drop significantly, many analysts still have high hopes for Vertex and view VX-809 to have blockbuster multibillion dollar potential in the future. The initial results were significantly above Wall Street expectations and brightened prospects for Vertex, whose shares were under pressure late last year as it appeared the company was losing ground in the race to bring the next generation of hepatitis C treatments to market.

Vertex Pharmaceuticals posted a net income of $296.06 million in April 2012 with earnings at $.14 per share. Currently, EPS estimates for Q2 2012 sit at $.63 with the next earnings report out at on July 27. Based in Cambridge, Massachusetts, Vertex is an American biotechnology firm focusing on viral infections, inflammatory and autoimmune diseases, and cancer research.

Contributor Thomas Doherty is a student at Villanova University majoring in Finance and Economics. All questions and comments can be sent to Thomas@KeeneOnTheMarket.com

For more information, Follow Andrew on twitter at https://twitter.com/#!/KeeneOnMarket or like us on facebook: https://www.facebook.com/KeeneOnTheMkt

Panasonic Corp gained 3.9% on announcement that the company plans to drop 50% of the 7000 strong workforce at its headquarters.

The worst hit of equities was the Renesas Electronic Corp dropping 16.4% to a record low after announcement that the company plans to raise 100b yen for a restructuring.

The FRSEurofirst 300 is up .1% being held by Spanish concerns. The Spanish 10 year bond yield remains at close to 6.5% where they see 7% as being unsustainable. The Spanish IBEX dropped 1.9%.

Commodities are looking alright this morning with crude, gold and silver up while natural gas remains a laggard.

Amazon is one stock to keep your eye on; regardless of being put on Goldman’s top 50 short positions they are making moves. They announced a deal last week with paramount to bring movies to their Prime Instant Video service over the next few years. They also plan on offering prepaid internet service for smart phones and tablets in Japan, which could shortly thereafter be launched in the US.

Contributer Chris Rygh is currently pursuing his MBA in Wisconsin and has a passion for the Market.
Comments can be directed to ryghcw19@uww.edu

Additionally, many investors blame lead underwriter (MS) and as such,Morgan Stanley’s stock price has dropped this week to $13.24, down 43% year-to-date.

In the wake of its more than $2 billion in trading losses, J.P. Morgan Chase, down 1.44% today, is expected to change its risk policy committee in the coming days. Reportedly, the change was in the works before the company on disclosed losses tied to wagers on corporate-credit indexes placed by a unit called the Chief Investment Office, which included a trader who has been called the London whale for his market-moving bets.

Overall, the markets were mixed today and finished flat, only slightly negative. The DOW, Nasdaq, and S&P all finished negative but none were down more than a quarter of a percent. The price of crude oil finished up .15% and gold futures were up .94%

Thomas Doherty is an undergraduate student at Villanova University majoring in Finance and Economics. For comments and questions, email Thomas@KeeneOnTheMarket.com

Unprofitable:  I lose money on this trade if SPY closes above $134.25 June 1, 2012.  The most I can lose on this trade is the amount I paid can be worth $1 minus the price I sold it for, $.25 for a total of $.75.  

Reason I Like This Trade:  I think the SPY is in a “Sell the Rally” mode, so I want to get short on any rally.  I make money on this trade if the SPY goes down, flat, or up a little bit

UPDATE 5.29.2012  With time on my side, even with a nice rally today in the stock market, this Spread is only worth $.28.  I like selling premium in the weeklies.  I will leave this Spread on as I think every rally in the stock market is a sale.

UPDATE 5.30.2012  With the stock market selling off, this Spread is currently worth $.16, but I am still leaving it on for more potential profits.

UPDATE 5.31.2012  I took this spread off today for $.03, it was not worth risking $97 to make $.03  Another winner at KOTM

Read more about break by www.keeneonthemarket.com

In today’s economic report, data showed consumers are more upbeat than they have been since the most recent recession. The Reuters/University of Michigan’s sentiment index rose more than expected at the end of May from earlier this month. Crude oil prices increased above $91 a barrel, a gain of 0.4%, while gold rose 0.5% to $1,565.

Facebook (FB) continues to drop after its highly publicized IPO and has once again, lost almost 3% and is now trading at $31.85, well belows its initial-public-offering price of $38. VeriFone (PAY) has slumped after lowering their third quarter estimates amid acquisition and restructuring costs and is currently trading at $37.83.