HLB Group shares, which had surged for a second straight session on news that the U.S. Food and Drug Administration approved a new drug, gave back most of their intraday gains, showing extreme volatility. Buying interest returned a day after the stocks hit their daily upper limits, but some names fell more than 10% from their session highs, raising caution about chasing the rally late.
HLB (028300) closed regular trading at 40,150 won on the 29th, up 450 won, or 1.13%, from the previous session, according to the Korea Exchange on the 30th. The stock extended its gains for a second day, but the intraday path resembled a roller coaster. Opening at 46,600 won, it climbed as high as 47,700 won, up 20.15% from the previous close of 39,700 won. It then quickly surrendered those gains, falling 7,550 won, or 15.83%, from the high to the close. Anyone who bought near the intraday high was sitting on a double-digit loss the same day.
Other group stocks followed a similar pattern. HLB Life Science rose as high as 4,290 won intraday, up 25.99% from the previous close, but finished at 3,630 won, up 6.61%. HLB Therapeutics turned negative outright. After jumping as much as 14.92%, it erased the entire advance and ended regular trading down 1.16%.
HLB Group stocks had drawn attention on the 28th, when they collectively surged to their daily price limits. HLB closed at 39,700 won, up 29.95%, while HLB Pharmaceutical (047920) rose 30.00%, HLB Life Science 29.96% and HLB Therapeutics 29.84%, all hitting the limit.
The catalyst behind the across-the-board rally was the FDA's approval of Lypictu, a bile duct cancer treatment developed by Elevar Therapeutics, HLB's U.S. subsidiary. The drug was cleared as a second-line treatment for adult patients with unresectable, locally advanced or metastatic bile duct cancer with confirmed FGFR2 gene fusions or rearrangements. Elevar plans to launch the drug in the U.S. market in the fourth quarter of this year.
Still, analysts caution against buying into stocks that have risen steeply over a short period, even when the news behind the move is clearly positive. The risk is particularly acute with affiliated group stocks, where a single catalyst lifts multiple listings at once and a wave of profit-taking can sharply amplify volatility.
Kim Ju-yeon, an analyst at Mirae Asset Securities (006800), noted that HLB Group shares traded higher intraday for a second day following the FDA approval of Lypictu, but added that investors "need to watch for wider volatility, with some names reversing into sharp declines."
