Against the Grain: Big Losers On A Winning Day (BDEL, RCON, KEYW, ACW, ZSL, EDZ, COWS)

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Perhaps it’s bargain hunting or perhaps hope is once again floating over a possible solution to Europe’s banking woes. Whatever it is, the DJIA is up nearly 250 points about an hour after the market opened this morning and the S&P 500 is up nearly 25 points. Both indexes have posted better than a 2% gain so far.

Gold has reversed its massive three-day decline to rise nearly 4%, to around $1,655/ounce, and silver is up more than 9%, to $32.74. Crude oil is also getting a boost, up nearly 4.5% at $83.73/barrel of WTI.

There are some losers as well. Biotech firm Biodel Inc. (NASDAQ: BIOD), Chinese business software maker Recon Technology, Ltd. (NASDAQ: RCON), security firm KEYW Holding Corp. (NASDAQ: KEYW), and vehicle parts maker Accuride Corp. (NYSE: ACW) are all down significantly.

Biodel Inc. (NASDAQ: BIOD) reported top-line results from a pump study of experimental insulins that failed to meet the company’s target profile. The company will cancel Phase 2 clinical testing, and basically start over again. Shares are down more than -25%, at $0.78, after setting a new 52-week low of $0.75. The 52-week high is $5.49. Volume is about 3x the daily average.

Recon Technology, Inc. (NASDAQ: RCON) is software services firm that provides automation tools to Chinese oil E&P companies. Shares are down more than -10% this morning, very likely due to recent disclosures of security holes in the SCADA software offered by multiple vendors. Recon has not been singled out, but investors are apparently not going to wait around. Shares posted a new 52-week low this morning of $0.86, before recovering to $0.95. The 52-week high is $6.49.

KEYW Holding Corp. (NASDAQ: KEYW) announced last night after the markets closed that it had failed to win a systems integration contract commonly referred to as ‘Aura’. Shares are off more than -20%, having posted a new 52-week low of $7.90, before coming back to $7.96. The 52-week high is $16.00. Volume is about 6x the daily average.

Accuride Corp. (NYSE: ACW) said this morning that it was selling a subsidiary to a new company formed by two private equity firms for an undisclosed amount. The company also lowered annual EPS guidance from $0.40-$0.50 to a range of an EPS loss of -$0.05 to a gain of $0.04. The company also lowered the top of its annual revenue guidance from $1 billion to $975 million. Shares are down more than -22% after posting a new 52-week low this morning of $6.32. The 52-week high is $16.34. Volume is more than double the daily average.

Several leveraged ETF bear funds are also getting hit hard this morning. The largest drop so far is in ProShares UltraShort Silver (NYSE: ZSL) a 2x-leveraged fund that seeks to double the daily drop in silver prices. With silver up around 9%, shares in this fund are down more than -21%, at $14.43, in a 52-week range of $10.63-$95.48.

The Direxion Emerging Markets Bear 3X ETF (NYSE: EDZ), which seeks to return triple the daily drop in the MSCI Emerging Markets Index, is down nearly -14% this morning, at $26.24, in a 52-week range of $15.78-$35.10. Volume is relatively light so far.

The Direxion Daily Agribusiness Bear 3X ETF (NYSE: COWS) is a triple-leveraged bet on a falling DAX Global Agribusiness Index. The fund is down more than -12% this morning, to $43.60, in a 52-week range of $31.67-$55.35. This fund is very lightly traded, with daily volume around 2,300 shares.

Paul Ausick

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