I hate falling into the trap of simply responding to the hottest news headlines - because very few people get rich by reacting to headlines and pulling the trigger on investments based on "hot" trends in the market.

At this point, computers can wipe the floor with most any day-trader, so if you think you can buy yesterday's news and still eke out a profit, you're probably wrong.

In the past couple weeks agriculture has been the hot topic on everyone's mind. First, fires in Russia caused wheat prices to double in less than a month as Vladimir Putin banned Russian wheat exports. In sympathy, many other crop commodities rose in price as well. Then yesterday, BHP Billiton (NYSE: BHP) the world's largest mining company, put in a failed bid to buy Potash Corp (NYSE: POT) the world's largest fertilizer company.

Shares of Gene Logic Inc. (Nasdaq:GLGC) are edging up in pre-market trading this morning after the pharmaceutical company announced that it will collaborate with the U.S. Food and Drug Administration (FDA) to share quality control methods and metrics to better understand dissimilar genomic data sent as part of regulatory submissions.

The collaboration is part of the FDA's “Critical Path Initiative,” an effort to facilitate the use of new scientific and technical methods, such as computer-based predictive models, to improve the predictability and efficiency of drug development from the lab to the shelf.

Shares of Gene Logic edged up $0.03, or 2.34%, to $1.27 in pre-market trading.

Shares of Hi-Tech Pharmacal Co., (Nasdaq: HITK) slid 9.4%, or $1.04, to $10.05 after the specialty pharmaceutical company reported it swung to a net loss in the fourth quarter.

For the three months ended April 30, 2007, Hi-Tech Pharmacal recorded a net loss of $2.2 million, compared with net income of $2.1 million in the fourth quarter last year.

The Amityville, N.Y.-based company said the net loss was due to a 19% decrease in net sales of its generic pharmaceutical products, which was due to pricing declines, and a 24% sales decrease in its over the counter products. Total net sales for the fourth quarter were $13.3 million, a decrease of 27% compared with net sales of $18.8 million in the fourth quarter last year.

Michael Donohue at Matrix USA, who has a strong “sell” on the stock, says Hi-Pharmacal is trading ahead of fundamentals. “Their return on capital went from 20% in January 2006 to -0.3% last quarter,” said Donohue. “Their EVA [economic value added] went from $7 million in January of 2006 to -$6 million in January 2007.” According to Donohue, the stock is the lowest ranked in Matrix’s universe--in the fifth percentile.

The manufacturer and marketer of generic and branded prescription and OTC products also reported fiscal year results today for the year ended April 30, 2007. The company reported a net loss of $2.0 million, or $0.17 per share for the year, compared with net income of $11.5 million, or $0.85 per fully diluted share, for 2006. Two analysts polled by Thomson Financial expected EPS for the fiscal year 2007 of $0.02. 

Shares of Durham, N.C.-based Inspire Pharmaceuticals, Inc. (Nasdaq: ISPH) are trading higher following news after Friday’s close that the U.S. Food and Drug Administration has approved the company’s treatment of bacterial conjunctivitis, a type of eye infection.  Shares are up $0.53, or 7.74%, to $7.38.

Biotechnology has been among the leaders of the market's latest upmove, and a trio of advisors are now looking at some speculative ideas in the small cap biotech space - a market niche that is known for its high risk and volatility.

Michael Ashbaugh, editor of MarketWatch's The Technical Indicator, sees a pair of small cap firms that he believes are poised for speculative gains. He notes, “Public since October 2005, NxStage Medical (Nasdaq: NXTM) is a small-cap maker of dialysis machines positioned to rise. It initially gapped higher in February, after the dialysis center chain DaVita Inc. bought a $20 million stake in the company.”

Meanwhile, over the past three weeks, Ashbaugh adds, the stock has established a tight range near its 52-week high, “positioning the shares to extend higher."

In addition, he says, “AVI BioPharma (Nasdaq: AVII) is a small-cap biopharmaceutical name positioned to rise. Earlier this month, it gapped above a five-month downtrend and its 50-day moving average. Since then, it's closely observed the 50-day as support, extending its gains."

Gregg Early also see upside opportunity in a speculative, small-cap biotech play -- pSivida Ltd. (Nasdaq: PSDV), an Australian biotech/nanotech company that is focusing  on developing controlled drug delivery technologies. “The company has signed a big deal with Pfizer (NYSE: PFE),” Early says, “and it’s pretty darn big.”

According to the editor of The Real Nanotech Investor, the firm signed a $165 million exclusive worldwide research and licensing agreement with Pfizer for pSivida's drug delivery technologies in ophthalmic applications.

Early explains, “Pfizer has bought $5 million worth of pSivida stock off the Australian exchange and has also received a $9 million private placement of shares at a U.S. price of about $2.20 a share.”

April 4, 2007 (SmallCapInvestor.com) – Possis Medical Inc. (Nasdaq: POSS) said late today that it has received the green light from federal regulators to market its Spiroflex VG catheter.