Oncology Innovation Just Hit a Turning Point -- Here's What to Watch
USA News Group News Commentary
Issued on behalf of Oncolytics Biotech Inc.
VANCOUVER, BC, June 30, 2025 /PRNewswire/ -- USA News Group News Commentary – The oncology landscape is being pulled in two directions. On one hand, U.S. cancer death rates continue to decline. On the other, global cases are expected to rise sharply —while early-onset diagnoses in younger patients are climbing at a troubling pace. At the same time, proposed federal budget cuts threaten to slash funding for the National Cancer Institute by up to 40%, raising concerns about the future of publicly funded research. With public resources under pressure, much of the innovation burden is shifting to the private sector, where a new generation of biotechs is stepping up—including Oncolytics Biotech Inc. (NASDAQ: ONCY) (TSX: ONC), Cellectar Biosciences, Inc. (NASDAQ: CLRB), Intensity Therapeutics, Inc. (NASDAQ: INTS), Accuray Incorporated (NASDAQ: ARAY), and Erasca, Inc. (NASDAQ: ERAS).
Industry analysts now estimate the global oncology drug market could surpass US$900 billion by 2034, fueled by rising demand for precision diagnostics and immune-driven treatments. For investors, the sector represents a timely opportunity to support the next wave of cancer-fighting innovation.
Oncolytics Biotech Inc. (NASDAQ: ONCY) (TSX: ONC) has further strengthened its executive team with the appointment of Andrew Aromando as Chief Business Officer, signaling an intensified focus on business development and strategic partnerships.
Aromando brings more than 30 years of biopharma experience and—alongside recently appointed CEO Jared Kelly—previously played a central role in Ambrx Biopharma's $2 billion acquisition by Johnson & Johnson. His arrival marks a leadership pivot aimed at unlocking value from pelareorep through late-stage development and corporate activity.
'Andrew's experience will be invaluable as we pursue aggressive clinical and business development strategies to maximize the value of pelareorep on an accelerated timeline,' said Kelly. 'He is a proven industry leader with a successful track record of navigating complex transactions and partnerships and an outstanding addition to our executive team.'
In his new role, Aromando will lead global business development and help shape the company's corporate, clinical, and regulatory strategies. Among his top priorities will be optimizing the value of pelareorep's clinical data across multiple tumor types, including pancreatic, breast, and anal cancers.
'I'm thrilled to join Oncolytics at such a pivotal moment in its evolution,' said Aromando. 'With promising data in difficult-to-treat cancers and a compelling body of clinical evidence in over 1,100 patients, I believe the Company is uniquely positioned to deliver meaningful value to patients and other stakeholders in the near term.'
Aromando has held senior leadership roles at oncology-focused biopharmas and global service firms, with emphasis on strategic planning, portfolio optimization, and product commercialization. He holds a BA from The College of New Jersey and an MA from Rutgers University.
Kelly added, 'Pelareorep's clinical data across multiple tumors is striking and represents the potential for a true backbone immunotherapy to address many in-need indications. The data show pelareorep creates a robust immune response in hard-to-treat cancers and improves survival in populations where prior therapies have failed.'
Together, Kelly and Aromando are spearheading a strategy to advance pelareorep through late-stage development while maintaining capital discipline and strategic flexibility. The program continues to yield data supporting its potential across a range of aggressive cancers.
Pelareorep currently holds FDA Fast Track designation for two indications— metastatic pancreatic ductal adenocarcinoma (mPDAC) and HR+/HER2- metastatic breast cancer (mBC) —underscoring regulatory interest in the program.
Across clinical trials, the viral-based immunotherapy has demonstrated immune activation, synergy with checkpoint inhibitors and chemotherapy, and encouraging efficacy in heavily pretreated patients.
In mPDAC, a Phase 2 cohort reported objective response rates (ORR) above 60% in tumor-evaluable patients, well above historical benchmarks. Survival outcomes at two years also exceeded expectations.
In HR+/HER2- mBC, randomized Phase 2 trials (IND-213 and BRACELET-1) showed overall survival trends supporting continued development.
In anal cancer, a Phase 2 cohort combining pelareorep with a checkpoint inhibitor produced partial or complete responses that surpassed historical rates for checkpoint monotherapy—further hinting at pelareorep's broad applicability.
With multiple cohorts progressing in the GOBLET study, including an externally supported pancreatic cancer arm, Oncolytics appears well-positioned to maintain clinical momentum while executing on strategic growth.
Notably, prior to the appointments of Kelly and Aromando, Oncolytics presented new GOBLET data at the 2025 ASCO Annual Meeting, demonstrating pelareorep's ability to activate both innate and adaptive immune responses in metastatic pancreatic cancer.
With compelling clinical evidence and new leadership in place, Oncolytics is moving forward with renewed purpose—advancing its lead asset and aligning operations for future partnership and commercialization opportunities.
CONTINUED… Read this and more news for Oncolytics Biotech at: https://usanewsgroup.com/2023/10/02/the-most-undervalued-oncolytics-company-on-the-nasdaq/
In other recent industry developments and happenings in the market include:
Cellectar Biosciences, Inc. (NASDAQ: CLRB) has entered a multi-year supply agreement with Nusano to secure iodine-125 and actinium-225 for its radiotherapeutic programs. These isotopes will support clinical development and potential commercial needs of CLR 125 for triple-negative breast cancer and CLR 225 for pancreatic cancer.
'Securing a reliable supply of both iodine-125 and actinium-225 is a critical milestone in advancing our targeted radiotherapy programs,' said James Caruso, CEO of Cellectar. 'This agreement ensures uninterrupted access to these essential isotopes, providing the necessary clinical development supply for our innovative clinical stage programs, including CLR 125 for triple negative breast cancer and CLR 225 for pancreatic cancer.'
I-125 and Ac-225 will be produced at Nusano's next-generation radioisotope production facility in Utah.
Intensity Therapeutics, Inc. (NASDAQ: INTS) reported that the first patients treated with INT230-6 in its Phase 2 INVINCIBLE-4 trial for early-stage triple-negative breast cancer showed high levels of tumor necrosis after just two injections—prior to beginning standard immunochemotherapy.
'We are excited to see that INT230-6 is achieving meaningful levels of necrosis in patients with evidence of immune activation,' said Lewis H. Bender, President and CEO of Intensity. 'TNBC Patients who have no live cancer in their tumor or nodes at the time of surgery have a significantly improved event-free survival advantage compared to those who do not have a pathological complete response.'
MRI scans revealed substantial necrosis with minimal residual cancer visible, suggesting a promising local tumor response. The study aims to improve pathological complete response rates, which are strongly linked to better outcomes in this aggressive cancer type.
Accuray Incorporated (NASDAQ: ARAY) recently presented new long-term data at ESTRO 2025, showing that its CyberKnife System continues to deliver beneficial outcomes in treating men with prostate cancer. The studies indicate the system's accuracy and precision enable treatment of high-risk disease, as well as recurrent prostate cancer following prostatectomy, with stereotactic body radiation therapy (SBRT), expanding access to a non-invasive, short course of care to more men.
'At this year's ESTRO meeting important analyses of real-world evidence (RWE) underscored the benefits of our unique robotic and helical platforms, reaffirming their use as patients' primary care option or along with other modalities such as surgery, chemotherapy or immunotherapy,' said Suzanne Winter, president and CEO of Accuray. 'Stand out studies focused on the company's CyberKnife System for the treatment of prostate cancer, building on a robust body of clinical data supporting its use and confirming the durability and quality of life after 10 years post-treatment.'
Erasca, Inc. (NASDAQ: ERAS) has received FDA clearance for an investigational new drug (IND) application for ERAS-4001, a potential first- and best-in-class pan-KRAS inhibitor targeting KRAS-mutant solid tumors.
'Our RAS-targeting franchise continues to meaningfully advance, and now with clearance of our IND for ERAS-4001, we are excited to advance both ERAS-4001 and ERAS-0015 into the clinic ahead of our guidance,' said Jonathan E. Lim, M.D., Erasca's Chairman, CEO, and Co-Founder. 'ERAS-4001 targets multiple KRAS mutations as well as wildtype KRAS but spares HRAS and NRAS, potentially enabling a better therapeutic window relative to pan-RAS inhibitors. We believe these attributes offer a differentiated approach that can overcome treatment resistance to pan-RAS and mutant-selective KRAS inhibitors and address unmet needs for the 2.2 million people diagnosed annually worldwide with KRASm tumors.'
The company will evaluate the therapy in its Phase 1 BOREALIS-1 trial, with initial monotherapy data expected in 2026. Preclinical data showed potent activity against multiple KRAS mutations while sparing HRAS and NRAS, supporting a differentiated therapeutic window.
Source: https://usanewsgroup.com/2024/09/21/is-oncolytics-biotech-the-markets-most-undervalued-cancer-opportunity/
CONTACT:
USA NEWS GROUP
[email protected]
(604) 265-2873
DISCLAIMER: Nothing in this publication should be considered as personalized financial advice. We are not licensed under securities laws to address your particular financial situation. No communication by our employees to you should be deemed as personalized financial advice. Please consult a licensed financial advisor before making any investment decision. This is a paid advertisement and is neither an offer nor recommendation to buy or sell any security. We hold no investment licenses and are thus neither licensed nor qualified to provide investment advice. The content in this report or email is not provided to any individual with a view toward their individual circumstances. USA News Group is a wholly-owned subsidiary of Market IQ Media Group, Inc. ('MIQ'). MIQ has been paid a fee for Oncolytics Biotech Inc. advertising and digital media from the company directly. There may be 3rd parties who may have shares of Oncolytics Biotech Inc., and may liquidate their shares which could have a negative effect on the price of the stock. This compensation constitutes a conflict of interest as to our ability to remain objective in our communication regarding the profiled company. Because of this conflict, individuals are strongly encouraged to not use this publication as the basis for any investment decision. The owner/operator of MIQ own shares of Oncolytics Biotech Inc. which were purchased in the open market, and reserve the right to buy and sell, and will buy and sell shares of Oncolytics Biotech Inc. at any time without any further notice commencing immediately and ongoing. We also expect further compensation as an ongoing digital media effort to increase visibility for the company, no further notice will be given, but let this disclaimer serve as notice that all material, including this article, which is disseminated by MIQ has been approved by Oncolytics Biotech Inc.; this is a paid advertisement, we currently own shares of Oncolytics Biotech Inc. and will buy and sell shares of the company in the open market, or through private placements, and/or other investment vehicles.
While all information is believed to be reliable, it is not guaranteed by us to be accurate. Individuals should assume that all information contained in our newsletter is not trustworthy unless verified by their own independent research. Also, because events and circumstances frequently do not occur as expected, there will likely be differences between the any predictions and actual results. Always consult a licensed investment professional before making any investment decision. Be extremely careful, investing in securities carries a high degree of risk; you may likely lose some or all of the investment.
Video - https://www.youtube.com/watch?v=72WhdDzvz08
Logo - https://mma.prnewswire.com/media/2603685/5394428/USA_News_Group_Logo.jpg
View original content to download multimedia: https://www.prnewswire.com/news-releases/oncology-innovation-just-hit-a-turning-point--heres-what-to-watch-302494557.html
SOURCE USA News Group
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Wire
an hour ago
- Business Wire
Cybin Announces Financing of up to US$500 Million Aggregate Principal Amount of Convertible Debentures
TORONTO--(BUSINESS WIRE)--Cybin Inc. (NYSE American: CYBN) (Cboe Canada: CYBN) (' Cybin ' or the ' Company '), a clinical-stage breakthrough neuropsychiatry company committed to revolutionizing mental healthcare by developing new and innovative next-generation treatment options, is pleased to announce the Company has entered into a securities purchase agreement (the ' Securities Purchase Agreement ') with High Trail Special Situations LLC (' High Trail '), pursuant to which the Company agreed to sell and issue to High Trail up to US$500,000,000 in aggregate principal amount of unsecured convertible debentures (the ' Convertible Debentures '). The sale and issue of US$50,000,000 principal amount of Convertible Debentures was completed on June 30, 2025 (the ' Private Placement '). The sale and issue of US$450,000,000 of the principal amount of Convertible Debentures will be determined at a future date, upon mutual agreement of the parties. 'This financing represents a major inflection point for Cybin and supports our position as a leader within our sector,' said Doug Drysdale, Chief Executive Officer of Cybin. "High Trail Capital is an experienced investor, and its confidence and appreciation of our breakthrough clinical data and intellectual property portfolio recognize the potential of the Company. This financing comes at an opportune time for Cybin, as we advance our lead programs, CYB003 and CYB004, in Phase 3 and Phase 2, respectively. CYB003 demonstrated over 70% remission rates and continued durability over 12 months for patients with uncontrolled depression. We await the conclusion of our CYB004 Phase 2 proof-of-concept study, in patients with generalized anxiety disorder,' said Drysdale. Joseph Gunnar & Co., LLC acted as the sole placement agent in connection with this transaction. Pipeline Acceleration Drives Multiple Value Creation Catalysts The funding will accelerate Cybin's clinical-stage programs across multiple high-value indications: CYB003 Program Achievements: Breakthrough Clinical Results: Unprecedented 71% remission rate in major depressive disorder at 12 months after two 16 mg doses in Phase 2 study Durability advantage: 12-month sustained efficacy demonstrating long-term therapeutic benefit FDA Recognition: Breakthrough Therapy Designation received, expediting regulatory pathway Multinational Phase 3 PARADIGM program underway CYB004 Program Momentum: Dual Indication Strategy: Expanding addressable market opportunity Phase 2 GAD study expected to complete around mid-year 2025 1 Commercialization Infrastructure: Manufacturing Scale-Up: Finalizing production capabilities for market launch IP Portfolio Expansion: Strengthening competitive moat with more than 90 patents issued and over 230 applications pending Strategic Partnerships: Developing market access and pre-commercialization alliances Value Catalysts Drive Sustained Momentum Near-Term Catalysts: CYB004 Phase 2 GAD study expected to complete around mid-2025 1 Initiation of second CYB003 pivotal study, EMBRACE, around mid-2025 1 EXTEND study initiation imminent 1 Medium-Term Catalysts (2025-2026): Phase 3 top line readout for CYB003 2H 2026 1 Regulatory submission preparations Commercial manufacturing readiness International market expansion planning Transaction Terms The Convertible Debentures have a two-year term from the closing date (the ' Term '). The Company shall pay guaranteed interest equal to 5.5% of the principal per annum for the Term. Such interest was pre-paid on closing. Upon the occurrence of an event of default, interest shall increase to a rate of 18% per annum on the outstanding principal balance. Pursuant to the terms of the Securities Purchase Agreement, the Company and High Trail may, upon mutual consent, enter into subsequent securities purchase agreements for the purchase and sale of up to an additional US$450,000,000 principal amount of Convertible Debentures, in tranches, in amounts on such dates as may be mutually agreed and each subsequent tranche shall include prepaid interest at a rate of 9.5%. Subject to the terms of the Securities Purchase Agreement and the Convertible Debentures, High Trail will be entitled to convert the principal amount of, and accrued and unpaid interest, if any, on each Convertible Debenture, in whole or in part, from time to time, into common shares in the capital of the Company (the ' Common Shares ') at a conversion price per Common Share equal to the lower of (a) 130% of the volume weighted average price (' VWAP ') of the Common Shares on the day prior to the initial issuance of the Convertible Debentures, or (b) the VWAP of the Common Shares during the five trading days immediately prior to the date of conversion. The Company, in its sole discretion, may prepay any outstanding amount under the Convertible Debentures, in whole or in part, in cash by providing High Trail with advance written notice prior to such prepayment. The prepayment shall include, (i) if paid during the first year after closing, a 5% prepayment premium on the amount of the prepayment or (ii) if paid thereafter, a 3% prepayment premium on the amount of the prepayment. The terms of the Convertible Debentures restrict the conversion of Convertible Debentures by High Trail if such a conversion or exercise would cause High Trail, together with any affiliate thereof, to beneficially own in excess of 4.99% of the number of Common Shares outstanding immediately after giving effect to such conversion. The Company intends to use the net proceeds from the Private Placement for working capital and general corporate purposes. The Convertible Debentures were offered on a private placement basis pursuant to prospectus exemptions in Canada and pursuant to exemptions and exclusions from the registration requirements of the United States Securities Act of 1933, as amended, and applicable state securities laws. The Company has agreed to use commercially reasonable efforts to: (a) file a prospectus supplement to the Company's base shelf prospectus dated August 17, 2023, as amended on December 22, 2023, April 8, 2024 and January 6, 2025, with applicable Canadian securities regulators to qualify the secondary market sales of the Common Shares in the United States; and (b) either (i) prepare and file the Canadian prospectus supplement with the United States Securities and Exchange Commission, or (ii) file a prospectus supplement pursuant to General Instruction II.L of Form F-10 with the United States Securities and Exchange Commission to the Company's registration statement on Form F-10 (File No. 333-284173), which was declared effective by the SEC on January 14, 2025, or on such other form as may be available to the Company, in either case qualifying the resale of the Common Shares underlying the Convertible Debentures. No securities regulatory authority has either approved or disapproved of the contents of this news release. This news release is not an offer to sell or the solicitation of an offer to buy the securities in the United States or in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to qualification or registration under the securities laws of such jurisdiction. The securities being offered have not been registered under the U.S. Securities Act, and such securities may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from U.S. registration requirements and applicable U.S. state securities laws About Cybin Cybin is a late-stage breakthrough neuropsychiatry company committed to revolutionizing mental healthcare by developing new and innovative next-generation treatment options to address the large unmet need for people who suffer from mental health conditions. With promising proof-of-concept data, Cybin is working to change the mental health treatment landscape through the introduction of intermittent treatments that provide long lasting results. The Company is currently developing CYB003, a proprietary deuterated psilocin analog, in Phase 3 studies for the adjunctive treatment of major depressive disorder and CYB004, a proprietary deuterated N, N-dimethyltryptamine molecule in a Phase 2 study for generalized anxiety disorder. The Company also has a research pipeline of investigational, 5-HT-receptor focused compounds. Founded in 2019, Cybin is operational in Canada, the United States, the United Kingdom, the Netherlands and Ireland. For Company updates and to learn more about Cybin, visit or follow the team on X, LinkedIn, YouTube and Instagram. Notes: There is no assurance that timelines will be met. Anticipated timelines regarding the initiation, advancement and results of clinical trials are based on reasonable assumptions informed by current knowledge and information available to the Company. See 'Cautionary Notes and Forward-Looking Statements'. Cautionary Notes and Forward-Looking Statements Certain statements in this news release constitute forward-looking information and forward-looking statements within the meaning of applicable securities laws (together, 'forward-looking statements'). Forward-looking statements are not based on historical facts, but rather on current expectations and projections about future events and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements. These statements generally can be identified by the use of forward-looking words such as 'may', 'should', 'could', 'intend', 'estimate', 'plan', 'anticipate', 'expect', 'believe' or 'continue', or the negative thereof or similar variations. Forward-looking statements in this news release include statements regarding the use of Private Placement proceeds; the conversion of the Convertible Debentures into Common Shares; the sale and issue of US$450,000,000 principal amount of Convertible Debentures at a future date; CYB004 Phase 2 GAD study expected to complete around mid-2025; Initiation of second CYB003 pivotal study, EMBRACE, around mid-2025; the Company's Medium-Term Catalysts for 2025-2026; Phase 3 PARADIGM program enrollment acceleration; the Company's ability to achieve commercial success; and the Company's ability to address the need for new and innovative treatment options for people who suffer from mental health conditions. These forward-looking statements are based on reasonable assumptions and estimates of management of the Company at the time such statements were made. Actual future results may differ materially as forward-looking statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of the Company to materially differ from any future results, performance, or achievements expressed or implied by such forward-looking statements. Such factors, among other things, include: fluctuations in general macroeconomic conditions; fluctuations in securities markets; expectations regarding the size of the psychedelics market; the ability of the Company to successfully achieve its business objectives; plans for growth; political, social and environmental uncertainties; employee relations; the presence of laws and regulations that may impose restrictions in the markets where the Company operates; implications of disease outbreaks on the Company's operations; and the risk factors set out in each of the Company's management's discussion and analysis for the three and nine month periods ended December 31, 2024 and the Company's annual information form for the year ended March 31, 2024, which are available under the Company's profile on and with the SEC on EDGAR at Although the forward-looking statements contained in this news release are based upon what management of the Company believes, or believed at the time, to be reasonable assumptions, the Company cannot assure shareholders that actual results will be consistent with such forward-looking statements, as there may be other factors that cause results not to be as anticipated, estimated or intended. Readers should not place undue reliance on the forward-looking statements and information contained in this news release. The Company assumes no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change, except as required by law. Cybin makes no medical, treatment or health benefit claims about Cybin's proposed products. The U.S. Food and Drug Administration, Health Canada or other similar regulatory authorities have not evaluated claims regarding psilocin, psychedelic tryptamine, tryptamine derivatives or other psychedelic compounds. The efficacy of such products has not been confirmed by approved research. There is no assurance that the use of psilocin, psychedelic tryptamine, tryptamine derivatives or other psychedelic compounds can diagnose, treat, cure or prevent any disease or condition. Rigorous scientific research and clinical trials are needed. If Cybin cannot obtain the approvals or research necessary to commercialize its business, it may have a material adverse effect on Cybin's performance and operations.
Yahoo
an hour ago
- Yahoo
Why Krispy Kreme Stock Skyrocketed Today
Krispy Kreme stock rose after being included in new indexes. The index inclusion meant that ETFs and other funds had to buy the stock in order to reflect the new compositions. Even with a big valuation gain today, Krispy Kreme stock is still down more than 70% year to date. 10 stocks we like better than Krispy Kreme › Krispy Kreme (NASDAQ: DNUT) stock closed out Monday's trading with big gains. The company's share price rose 9.8% in a day of trading that saw the S&P 500 index and the Nasdaq Composite index rise 0.5% and 0.4%, respectively, and set new record highs. The stock had been up as much as 11.7% before pulling back before the day's close. In addition to bullish momentum across the broader market, Krispy Kreme stock was pushed higher thanks to inclusion in new indexes. Despite today's pop, the doughnut specialist's share price is still down 71% across 2025's trading. As part of the annual recombination of Russell indexes that occurs at the midyear point, Krispy Kreme stock has been included in the Russell 2000 Value index, the Russell 2500 Value index, the Russell Small Cap Comp Value index, and the Russell 3000E Value index. Due to the recombination, exchange-traded funds (ETFs) and other funds that track these indexes have to buy Krispy Kreme stock in order to reflect its inclusion. Along with positive momentum lifting the broader market today, buying action from the new index inclusions helped Krispy Kreme shares see a strong rally today. The stock had also been facing downward pressures recently following the ending of the company's partnership with McDonald's, but shares are now down just 1% over the last month. Krispy Kreme has been struggling to energize its growth engine. The business saw revenue fall roughly 15% year over year to $357.2 million in the quarter, and the business posted a non-GAAP (adjusted) loss per share of $0.05 in the period -- swinging from a profit of $0.07 per share in last year's quarter. Now valued at roughly $496 million, Krispy Kreme is trading at just 32% of this year's expected sales. While the company may look cheap on that valuation basis, signs that the business' sales and margins can stabilized may be needed in order for the stock to see a sustained rally. Before you buy stock in Krispy Kreme, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Krispy Kreme wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $966,931!* Now, it's worth noting Stock Advisor's total average return is 1,062% — a market-crushing outperformance compared to 177% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 30, 2025 Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Why Krispy Kreme Stock Skyrocketed Today was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Forbes
an hour ago
- Forbes
Equity Prices Rise To Record Levels Even As The Economy Slows
On Friday (June 27th), both the S&P 500 and the Nasdaq closed at record levels. This occurred despite growing evidence of a slowing economy and continued trade angst.1 Meanwhile, the DJIA is still -2.65% away from its 12/4/24 peak (45,014.04) and the small cap Russell 2000 remains off more than -11% from its 11/25/24 high (2,442.03).2 This isn't a surprise to us as the industrial economy and especially small caps always feel an economic slowdown before it becomes mainstream. In addition, the DJIA and Russell 2000 have many fewer tech companies, the sector where the action is. The consolidated reporting charts are for informational purposes only and should not replace the ... More official reporting made available by each index, custodian, market and/or security. The table above shows that all the major indexes had a good week and month. For the year, the S&P 500 is up about 5% (about where is should be halfway through a typical 10% growth year), while the other three major indexes are lagging. The Nasdaq is up less than 1% while the DJIA (industrials) and the Russell 2000 (small cap) are underwater year to date (with the Russell 2000 off more than -5%). So, a mixed bag.1 2 Five of the Magnificent 7 (NVDA, MSFT, AMZN, META and GOOG) enjoyed a prosperous week. AAPL and TSLA were marginally positive. For the year to date, it is really a mixed bag. AAPL and TSLA are down nearly -20%, and GOOG is down more than -6%. Meanwhile META, NVDA and MSFT show substantial gains, while AMZN is just keeping its head above water. Nevertheless, on Friday, NVDA closed at a new record high.3 4 The consolidated reporting charts are for informational purposes only and should not replace the ... More official reporting made available by each index, custodian, market and/or security. The Consumer As the consumer goes, so goes the economy. So, when the consumers' income falls, or inflation rises faster than that income, real consumption growth is negatively impacted. So, it isn't good news to learn that personal earnings (excluding government transfers) fell in May (-0.1%) and have been negative in three of the past four months. Perhaps this is responsible for the -0.1% drop in consumer spending in May which, after including the effects of inflation, amounts to -0.3% in real terms. There was a fall in spending on durable goods of -1.8%, -0.3% for non-durables, and services were essentially flat (-0.03%).5 There are other signs of consumer discomfort. One such sign is the rise in the number of multiple job holders. This occurs when the income from a single job isn't sufficient to maintain that worker's lifestyle. Either live at a lower level or get a second job! The chart shows a steady upward trend in this statistic since the pandemic.6 Bureau of Labor Statistics Other such signs can be seen in the delinquency rates on consumer loans. Delinquencies on mortgages, auto loans and consumer credit are on the rise. The left-hand side of the chart below shows that credit card balances are at record levels as consumers try to maintain their standard of living (Charge it now – worry about paying for it later!). Note the rapid rise in delinquencies (right-hand side of the chart below) in the post-pandemic period. Note that while credit card delinquencies of 90+ days appear to have come down recently, this is most likely due to increased write-offs of such debt by the financial (bank) system.7 8 FRBNY Consumer Credit Panel, Equifax, Bloomberg Finally, a look at the major retailer reports reinforces the aggregate data. Best Buy, for example, recently cut its sales forecast for 2025. Kohl's reported -3.9% sales growth in Q1, and went on to forecast -5% to -7% for 2025 as a whole. Foot Locker reported that sales fell -2.6% from year earlier levels, and Hormel trimmed its earnings outlook.5Housing As always, housing is a good indicator of the economy's economic health. The left-hand side of the chart below shows the slowdown in Existing Home Sales over the past couple of years, and the right-hand side indicates the rapid rise in the months' supply of inventory at current sales rates (now higher than the pandemic peak). This is a sign of growing weakness and inevitably leads to a slowdown in new home construction with spillover effects into the labor market. National Association of Realtors and Bureau of Labor Statistics Note in the New Home Sales chart below the horizontal trend since 2023 and the latest turndown in 2025. U.S. Census Bureau As demand stagnates, so do home prices. As seen from the chart below, the median sales price of new homes has stagnated for the past two years. Final Thoughts Equity markets continued their upward path the week ended June 27th with record highs for the S&P 500 and the Nasdaq. It was a good week and a good month for stocks. But this rising tide has put the P/E ratio significantly above its long-term mean. Investors beware! For 2025, the S&P 500 leads the pack, up nearly 5%, while small-caps also carry a '5' growth number, but with a negative sign.1 2 It was also a positive week for all of the Magnificent 7 (AAPL barely so). Year-to-date, the stock prices of four of the Mag 7 are positive and three are negative, with AAPL and TSLA each down nearly -20%!3 4 As the consumer goes, so does the economy. One can see the stress developing in the consumer sector by looking at the rising trend of multiple job holders and the rise in both credit card balances and 90+ day delinquencies.6 7 8 Housing is always a bellwether of the economy. The fact that Existing Home Sales have tanked and New Home Sales have flatlined tells an astute observer that the economy has entered rocky ground. Robert Barone, Ph.D. (Joshua Barone and Eugene Hoover contributed to this blog.) Robert Barone, Joshua Barone and Eugene Hoover are investment adviser representatives with Savvy Advisors, Inc. ('Savvy Advisors'). Savvy Advisors is an SEC registered investment advisor. Material prepared herein has been created for informational purposes only and should not be considered investment advice or a recommendation. Information was obtained from sources believed to be reliable but was not verified for accuracy. Ancora West Advisors, LLC dba Universal Value Advisors ('UVA') is an investment advisor firm registered with the Securities and Exchange Commission. Savvy Advisors, Inc. ('Savvy Advisors') is also an investment advisor firm registered with the SEC. UVA and Savvy are not affiliated or related. References:1 CNBC, June 29, 20252 Yahoo Finance, June 30, 20253 Business Insider, May 20, 20254 Alpha Spread, March 10, 20255 CNBC, June 27, 20256 Bureau of Labor Statistics, June 9, 20257 Mortgage Bankers Association, May 13, 20258 KPAX/TransUnion, December 12, 2024
