As February comes to a close, we are seeing more volatility than ever among both blue chip and penny stocks. To understand why let’s take a look at some of the overall factors that are impacting the stock market today.
First, the $1.9 trillion stimulus package has sparked long-term fears of inflation among investors. In addition, the attack by the Biden Administration on Syria has reinstated fears of potential conflict. While these factors may not seem to have an important role when it comes to penny stocks, we have to consider that the stock market is incredibly speculative right now. This means that geopolitical factors have a greater impact than they have had in the past few months. In the past few weeks, the S&P 500 has hit record highs before bouncing back down.
This is a clear sign of the massive anxiety that exists in the market right now. In addition, the yields on 10-year U.S. Treasury bonds have reached over 1.5% for the first time in over a year. While these yields are rising, investor fear has also continued to rise. James Smith, a market economist at ING stated that “It’s a bad thing when yields are rising and growth expectations aren’t.”
Penny Stocks to Watch
Despite these economic factors coming into play, traders remain dialed into small-cap stock trends. With all of this in mind, it could be time to find opportunities with certain penny stocks. Here are three to watch as market volatility continues this week.
- HUMBL Inc. (OTC:TSNPD)
- vTv Therapeutics Inc. (NASDAQ:VTVT)
- Color Star Technology Co Ltd. (NASDAQ:CSCW)
HUMBL Inc. is a tech company that offers a large ecosystem of applications for global enterprises. Before we get into the details, it’s worth noting that the formerly known Tesoro Enterprises Inc. changed its name to HUMBL Inc. as of Thursday, February 25th. In addition to this, the company effected a 1:4 reverse split of its common stock in addition to making other structural changes.
With this, COO Jeffrey Hinshaw stated that “The company’s Board of Directors concluded that it was important to quell the volatility in the share price. Prospective investors and current shareholders were concerned that it was difficult to pinpoint the true value of the common shares. Furthermore, this will force any outstanding short positions to cover their position. The board was also sympathetic to the need to not wipe out the holdings of the shareholders, and therefore determined that this small reverse split would satisfy both requirements.”
To aid in any confusion, HUMBL will officially change its stock symbol to HMBL on March 26th. As a tech company, HUMBL offers various point-of-sale products for the benefit of both consumers and merchants. It allows for the processing of payments through its HUMBL Hubs product as well as the HUMBL Mobile App. In addition, the company is working to push its HUMBL Marketplace, in order to further the amount of commerce that it can facilitate. With the growth of online sales during the pandemic, companies like HUMBL have benefited greatly.
vTv Therapeutics Inc.
February has been a big month for vTv. Since the 2nd, shares have climbed as high as $3.59 following big progress in the company’s treatment pipeline. Initially sparked by the notice of allowance by the USPTO for a patent, VTVT stock began climbing from its $2 level. While patents are great news, the more recent point of interest has been on the company’s safety study in HPP737 which has shown potential as a therapeutic in COPD and Psoriasis. The company expects to complete the study in Q2 2021. Furthermore, vTv’s strategic partner, Newsoara Biopharma, has advanced HPP737 into phase 2 with the initiation of a proof of concept study in COPD in China.
The company also develops treatment for diabetes patients. The American Diabetes Association’s Diabetes Care journal published results from the company’s SimpliciT-1 study assessing the safety and efficacy in its TTP339 drugs an adjunct to insulin therapy in Type 1 diabetes patients. Published results from the study showed that treatment with 800mg of TTP399 demonstrated statistically significant reductions in HbA1c, as previously announced.
With multiple trials and numerous pipeline treatments, will biotech market momentum help propel VTVT stock heading into March? Year-to-date, the penny stock is up over 40%.
Color Star Technology Co Ltd.
Shares of CSCW saw a swift rebound on Friday. This move came one day after the penny stock dipped with the rest of the tech sector. For those of you who pay attention to technical trends, Color Star stock has maintained levels above its trailing 50-Day moving average ever since late December. Furthermore, in February, you’ll see that the 50DMA cross up and over the 200 Day Moving Average forming what’s known as a golden cross. This is typically considered a bullish sign and generally obtains confirmation with higher levels of volume. Needless to say, CSCW stock ended up climbing strong after this cross-over. But recent selling pressure to the stock back down, narrowly testing its 50DMA for the first time since December.
This week, Color Star had been in the news following an update on fundraising activities. The company announced a $26 million round to upgrade artificial intelligence and virtual reality technologies.
CEO of Color Star, Luke Lu, explained, “The Company has plans to establish a center in Silicon Valley that focuses on the research and development of VR, which will be integrated into the Company’s various businesses, including offline and online concerts, celebrity education, and peripheral product sales so that users are not only ‘viewing’ a web page on 2D, but actually merging parts of VR with reality.”
With this move, some positive sentiment has begun building buzz around the company. One thing to note if CSCW stock is on your list has to do with the offering itself. The company is raising funds at $1.30 per share. Considering that the price was only $1 when the news came out, Color Star appears to be raising money at a premium to the current market price.