News events of the day are providing a dramatic illustration that not all biotech companies are the same.

Just as President Obama lifted the executive order banning the use of embryonic stem cells for research, Roche and Genentech (NYSE: DNA) appear to have reached an agreement on Roche's bid to acquire the 44% of DNA that Roche does not currently own.

Shares of biotech companies engaged in stem cell protocols rallied after the Obama announcement. While most of these companies are small in size with stock prices below $2 per share, the announcement gave impetus to price increases of 17% to 100%.

Do not underestimate the power of a new administration in Washington. With the ability to spend a huge amount of dollars, team Obama can wield tremendous influence in the market.

Case in point is the stem cell space. It is widely expected that Obama will issue an executive order eliminating restrictions on stem cell research.

Stocks like StemCells Inc. (NASDAQ: STEM) and Geron Corp. (NASDAQ: GERN) have been moving higher since the inaugural.

Coincidentally, on Friday, GERN announced approval for human trials for its treatment of spinal chord injuries using stem cells. Both GERN and STEM were up big as a result.

Another space expected to do well under the Obama administration is construction. A massive stimulus plan is said to be coming in February. A key point of the plan will be to boost infrastructure spending.

The dollars will benefit companies like Fluor Corp. (NYSE: FLR) and Jacobs Engineering (NYSE: JEC). Unlike stem cells, the market has yet to move these stocks higher. FLR is down more than 10% and JEC is down nearly 18% so far this year.

Geron (NASDAQ: GERN - option chain) shares have shot more than 50% higher today after the FDA granted the company clearance to begin trials of a human embryonic stem cell-based therapy for people with spinal chord injuries. This monumental step officially is in no part President Obama's doing, but he has made his stance clear on the use of stem cells, and included a line in his inauguration speech that mentioned that "We will restore science to its rightful place, and wield technology's wonders to raise health care's quality and lower its cost." If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on GERN.

GERN opened this morning at $6.48. So far today the stock has hit a low of $6.19 and a high of $8.38. As of 12:20, GERN is trading at $7.93, up $2.72 (52.2%). The chart for GERN looks bullish.

For a bullish hedged play on this stock, I would consider a March bull-put credit spread below the $5 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make an 11.1% return in just two months as long as GERN is above $5 at March expiration. Geron would have to fall by more than 43% before we would start to lose money. Learn more about this type of trade here.

Brent Archer is an options analyst and writer at Investors Observer.

DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about. At publication time, Brent neither owns nor controls positions in GERN. He does own STEM.

MAJOR PAPERS:

• Last November, Google Inc (NASDAQ: GOOG) and 30 partners were said be developing a new type of handset using Android that was expected to revolutionize the industry. The first new phones were expected to be available in this year's second half but are now slated for the fourth quarter the Wall Street Journal reported.
• According to people familiar with the situation, the Wall Street Journal reported that Citigroup Incorporated (NYSE: C) will make sharp cuts in its investment banking division this week.
• The Wall Street Journal reported that Live Nation Inc's (NYSE: LYV) Chairman, Michael Cohl, stepped down down as a director and executive to end the strategy feud with CEO Michael Rapino. over how to pursue the "360 deals" with music superstars.
• The Financial Times reported that there are worries that investment banks will accelerate the pace of their layoffs this summer, after it became known that The Goldman Sachs Group Inc (NYSE: GS) gave pink slips to workers in its investment banking division last week. Goldman is now expected to lay off up to 10% of the workers at the division.

OTHER PAPERS:

• New Jersey put its $150M center for stem cell research on hold, the Star Ledger reported, eight months after ground was broken on the project.

GE Healthcare recently announced that it will join forces with Columbia University's Earth Institute, directed by Jeff Sachs, to address pressing healthcare needs in rural Africa. Over the next 5 years GE Healthcare will donate $20 million worth of water filtration systems, power generation systems, healthcare materials, and other equipment to be used at UN Millennium Village Project sites in as many as 10 African nations with particularly acute rural health care needs. The UN Millennium Village Project is designed to reduce extreme poverty, hunger and disease by improving community health and reducing infant and maternal mortality rates. Participating countries include Ethiopia, Nigeria, Ghana, Kenya, Rwanda and Malawi.

In addition to providing healthcare and water filtration equipment, GE will offer its expertise for industrial infrastructure development. This will insure that adequate training in the use and maintenance of the equipment is provided so that Millennium Village Project sites will continue to benefit from GE's donation. GE Healthcare's donation will be combined with contributions from other NGO's to expand the reach of the Millennium Village Project.

In the U.S., GE Healthcare recently signed a 15-year deal to supply stem cell harvesting systems so that parents can have stem cells from their children's umbilical cords harvested and stored for possible later use to treat such diseases as leukemia, lymphoma and genetic blood disorders. ThermoGenesis Corporation developed the stem cell harvesting system called AutoXpress System. GE Healthcare will control the manufacture and distribution of the AutoXpress System. ThermoGenesis Corporation expects to gain $50 million in revenue over the course of the 15 year agreement.

GE closed at $34.55, up 15 cents. Not exactly a major push, but it's nice to see things moving up for GE when its been pumping out a slew of positive reports. Today's news includes a major step forward in biotechnology for GE Healthcare is now better able to automatically harvest cord blood, which allows stem cells to be harvested.

The interesting news for GE today came from the normally moribund NBC division which is going to release Jay Leno's Tonight Show on iTunes in addition to the other NBC shows recently added to the online store. I don't imagine this will turn into a major cash cow, but CSI is certainly a very popular show all around. Finding other ways to gain money for existing properties is smart, and it is encouraging that more shows are coming out this way.