Wall Street Lunch: Pfizer Looks To Take Next Step In Weight-Loss Drugs
Contributor since 2023 / 1797 Followers
Summary:
- Pfizer CEO announced testing of three new weight loss drugs, one with a different mechanism than current GLP-1 agonists.
- Consumer confidence slightly down in May, with expectations index falling.
- Tesla recalls thousands of Cybertrucks over wiper defect.
- Hedge funds selling chip stocks and tech, while net buying financials.
9dreamstudio
Listen below or on the go on Apple Podcasts and Spotify
Weight loss drug candidate will differ from popular GLP-1s. (0:16) Tesla recalls thousands of Cybertrucks. (3:09) Hedge funds keep cashing in on tech. (3:55)
The following is an abridged transcript:
Our top story so far, Pfizer (NYSE:PFE) CEO Albert Bourla said the drugmaker is testing three new weight loss drugs, one of which will have a different mechanism from currently available and popular GLP-1 agonists.
Bourla did not reveal the exact mechanism of the third drug, but mentioned the other two would be GLP-1 candidates similar to Novo Nordisk’s (NVO) Wegovy, which recently received approval in China.
The chief executive also said Pfizer plans to release data later in 2024 showing progress in development of one of the weight loss therapy candidates, danuglipron, which will be in pill form.
Besides danuglipron, there are other drug candidates in mid-stage development for obesity from Viking Therapeutics (VKTX), Structure Therapeutics (GPCR), Altimmune (ALT), Zealand Pharma (OTCPK:ZLDPF) and Amgen (AMGN).
In today’s trading, growth stocks are trying to recover some the previous session’s losses, with the Nasdaq (COMP.IND) up +0.5%.
The Conference Board said its May measure of consumer confidence came in at 100.4, down slightly from April and right in line with economists’ forecasts.
The Present Situation Index ticked up to 141.5, while the Expectations Index fell to 73.
Pantheon Macro economist Ian Shepherdson said: “The drop in the expectations index was driven partly by a decline in the proportion of people expecting business conditions to improve over the next six months, to its lowest level since October 2011.”
But the “mean one-year ahead inflation expectations fell to 5.3% in June, from 5.4% in May, and were only marginally above the 2000-to-19 average, 5.0%, which likely is consistent with near-2% CPI inflation. Accordingly, the Fed will continue to conclude that inflation expectations remain ‘well anchored.’”
And there were mixed numbers for housing prices. The April S&P CoreLogic Case-Shiller Home Price Index Composite for 20 cities rose 7.2% annually, more than the 7% expected. But FHFA House Price Index rose 0.2% M/M in April, short of the 0.3% rise expected.
Among active stocks in today’s session, Airbus (OTCPK:EADSY) (OTCPK:EADSF) fell more than 9% in Paris trading, a day after the plane maker reduced its goal for deliveries of commercial aircraft and slashed financial targets. The decline in its stock price erased about $10 billion from Airbus’s market value, leaving it at about 107.9 billion euros ($115.8 billion).
UBS upgraded Cloudflare (NET) to Neutral from Sell and raised the price target on the stock to $82 from $76.
Following some Global Traffic Manager momentum, better Secure Access Service Edge checks, the first-quarter guide-down and a valuation de-rating, analysts think that shares capture a more balanced risk/reward.
And shares of Carnival (CCL) rose after the cruise operator reported results that beat on the top and bottom lines. For the full year, Carnival expects adjusted EBITDA of about $5.83 billion, better than March guidance by around $200 million.
In other news of note, Tesla (Tesla) is recalling 11,688 Cybertrucks due to a windshield wiper failure that can reduce visibility.
The NHTSA recall includes all 2024 model year Cybertruck vehicles manufactured from November 13, 2023, to June 6, 2024. On the affected vehicles, the front windshield wiper motor controller may stop functioning due to electrical overstress to the gate driver component.
Separately, the company is also recalling 11,383 units of certain 2024 Cybertruck vehicles as a trim in the trunk bed could have been improperly attached. A loose applique can detach from the vehicle, creating a road hazard for following motorists and increasing the risk of a crash.
And in the Wall Street Research Corner, hedge funds continue to cash in on tech gains.
As concerns about weakness in the semiconductor sector grow, hedge funds have continued to sell chip stocks and tech overall for most of the last month. Goldman’s Prime brokerage said Info Tech (XLK) was the most net sold sector last week, driven by short and long sales. Info Tech has been net sold in four of the last five weeks.
They said: “Most subsectors were net sold on the week, led in notional terms by Semis & Semi Equip (long sales), Tech Hardware (short sales), and Communications Equipment (long + short sales), which outweighed net buying in Software and IT Services.”
“Info Tech is still among the most notionally net bought US sector on the Prime book YTD.”
While selling tech, appetite grew for Financials (XLF), with those stocks net bought for the second-straight week and at the fastest pace since December. That was driven by long buying and short covering “to a lesser extent.”
Editor’s Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.