Bionomics (NASDAQ: BNOX) stock is down 20% premarket. It’s possible that BNOX is suffering from a change in sentiment. But it’s also possible that this is really just a technical move. Something caused by the one single event, something that when done will stop influencing the stock price. If that second argument is true then there’s a little speculation to be had.
As to what happens at Bionomics: “Bionomics Limited, a clinical stage biopharmaceutical company, discovers and develops novel drug candidates for the treatment of central nervous system disorders and cancers. The company’s lead drug candidate includes BNC210, a negative allosteric modulator of the a7 nicotinic acetylcholine receptor, which is in phase 2 clinical trial for the treatment of social anxiety disorder and phase 2b to treat post-traumatic stress disorder.” Well, development pharma is always a risky business so whatever we do we’ll not want to go all in.
As we’ve said before about the issue at Bionomics: “Bionomics (ASX: BNO) (NASDAQ: BNOX) shares are down 41% in Australia. The BNO share price decline is the result of the company's decision to delist in Australia. However, that Nasdaq quote for Bionomics, BNOX, is unchanged on the news.” OK. But then also “There is a problem here as well. Which is that the transfer of shares, from one quote to the other, will take time. So, there's price risk over that time period. That can also be covered - go short the US quote, long the Australian, while that paperwork has to be done. By now we're getting into quite a sophisticated trade. Which does indeed depend upon that price differential surviving as the American markets open. But it is possible that the trade will persist. The rush for the doors in Australia could be overdone and so leave a price gap for those willing to fund a position over the time it takes to do the paperwork.”
There could be people moving that Australian stock to the US then selling (the Oz quote has now gone). Which means an artificial wave of selling. That, in turn, might mean that when it’s over there will be a recovery in the stock price.
Not exactly an obvious trade we agree but it is possible that the Bionomics stock price weakness is just an artefact of the loss of that Australian quote.