WSJ What’s News
What’s News in Markets: Amgen’s Prognosis, Quantum Boost, iPhone Makeover
· Summarized
Key takeaways
- Inflation fears, geopolitical tensions, and expected Federal Reserve rate hikes caused significant market declines, but optimism returned later in the week.
- Pharmaceutical failures, particularly around drugs targeting L.P. Little A, cast doubt on the future of some cardiovascular treatments, impacting companies like Amgen and Novartis.
- The government is actively investing in strategic tech companies, including quantum computing firms and AI startups, signaling a focus on maintaining technological leadership.
- Apple's new foldable iPhone, priced at nearly $2,000, represents a major product innovation with mixed market reactions but strong demand forecasts in the short term.
Summary
Market Overview and Weekly Stock Movements
This section provides an update on the stock market's performance over the past week. It highlights the challenges traders faced due to inflation pressures, soaring oil prices driven by geopolitical tensions, and anticipated Federal Reserve rate hikes. The Dow, S&P 500, and NASDAQ all declined, with healthcare suffering the most after a failed drug trial. Despite these setbacks, there was some optimism as stocks rebounded towards the week’s end, in part due to expectations of controlling inflation.
Healthcare Sector and Pharma News
The healthcare sector experienced significant downturns, primarily influenced by trial failures of major pharmaceutical companies. Amgen’s shares plummeted after a drug trial failure, compounded by Novartis's similar clinical trial results that cast doubt on the effectiveness of lowering L.P. Little A to prevent cardiovascular events. These failures raised concerns about the potential of these treatments and negatively impacted investor confidence in the industry.
Quantum Computing Investments and Strategic Tech Funding
The episode discusses a boost for quantum computing firms, with federal agencies investing heavily in this emerging technology. Three firms received $100 million each from a government agency to support their R&D efforts. Additionally, the Pentagon is contemplating a large loan to an AI startup, illustrating significant government interest in strategic technology sectors. These investments underscore a broader trend of public funding aimed at maintaining technological leadership and supporting long-term innovation.
Apple’s New Foldable iPhone and Market Response
Apple announced its first foldable iPhone, priced at $1,999, making it the most expensive iPhone ever. While initial stock response was modest, there was a positive shift following analyst reports suggesting strong demand. The new device signals Apple's push into the foldable phone market, expecting to capture a significant share of its revenue despite the category’s overall sluggish growth. The episode covers the potential market impact and consumer acceptance challenges.
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Show notes
Why did a failed Novartis drug trial tank Amgen’s shares? And how is taxpayer money funding quantum-computing companies? Plus, will people pay $2,000 for a foldable iPhone? Host Imani Moise discusses the biggest stock moves of the week and the news that drove them.
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