Categories
Business

Dow Jones Falls, Tech Stocks Sell Off To Kick Off Week

 

The Dow Jones Industrial Average dropped Monday, as the stock market paused after a two-day bounce off correction lows.



X


Twitter (TWTR) stock dropped more than 4% after Elon Musk said the company’s legal team accused him of violating a nondisclosure agreement. On Friday, Musk said his $44 billion deal to acquire Twitter was on hold due to questions regarding the number of fake accounts.

electric-vehicle giant Tesla (TSLA) traded down around 1% Monday morning.

Elsewhere, Dow Jones tech leaders Manzana (AAPL) and microsoft (MSFT) traded down 0.9% and 0.85%, respectively, in today’s stock market. Meanwhile, McDonald’s (MCD) shares slipped a fraction after the company said it would quit Russia and sell its business there over its invasion of Ukraine.

As the stock market correction attempts to find a bottom, Dow Jones leaders Chevron (CLC) and Merck (MRK)—along with Cheniere Energy (LNG), Eli Lilly (LLY), Exxon Mobil (XOM) and Northrop Grumman (NOC) — are among IBD’s top stocks to watch for Monday.

Eli Lilly and Microsoft are IBD Leaderboard stocks. Exxon and Merck were featured in last week’s Stocks Near A Buy Zone column. Eli Lilly was Wednesday’s Stock of the Day.

Dow Jones Today: Treasury Yields, Oil Prices

After Monday’s open, the Dow Jones Industrial Average moved down 0.6%, while the S&P 500 fell 0.7%.The Nasdaq sold off 1% in morning trade.

Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) fell 0.9%. The SPDR S&P 500 ETF (SPY) fell 0.7%.

The 10-year Treasury yield ticked lower than 2.9% Monday morning. The 10-year Treasury yield snapped to a four-day losing streak Friday, jumping to 2.93%. Meanwhile, US oil prices shed less than 1%, with West Texas Intermediate crude holding above $109 a barrel after a three-day advance.

Stock Market Rally Attempt

The major stock indexes finished with strong gains Friday. The Dow Jones Industrial Average rallied 1.5%, snapping a six-day decline, while the Nasdaq catapulted 3.8%.

Friday’s The Big Picture column commented, “So while many investors have likely raised quite a lot of cash and are afraid to touch equities, the market still needs a new host of excellent companies that show the key elements of CAN SLIM investing: rising fundamentals, outperformance vs. most stocks today, and evidence of rising fund ownership.”

If you’re new to IBD, consider taking a look at its stock trading system and CAN SLIM basics. Recognizing chart patterns is one key to the investment guidelines. IBD offers a broad range of growth stock lists, such as Leaderboard and SwingTrader.

Investors also can create watchlists, find companies nearing a buy point, or develop custom screens at IBD MarketSmith.


Five Dow Jones Stocks To Watch Now


Dow Jones Stocks To Watch: Chevron, Merck

Dow Jones leader and energy giant Chevron is in a flat base that has a 174.86 buy point, according to IBD MarketSmith chart analysis. CVX shares traded up 1.9% Friday, extending a win streak to four sessions. Shares bullishly regained their 50-day line and are about 4% away from the latest entry. Chevron shares rose 1% Monday morning.

Drug leader Merck remains above a cup-with-handle’s 89.58 buy point after shares fell 0.5% Friday. The 5% buy area goes up to 94.06. Shares gained nearly 1% early Monday. One positive signal, the stock’s relative strength line hit another high last week, indicating big stock market outperformance during the current stock market correction.

MRK stock boasts a 98 out of a perfect 99 IBD Composite Rating, per IBD Stock Checkup. Investors can use the IBD Composite Rating to easily gauge the quality of a stock’s fundamental and technical metrics.


Three Top Growth Stocks To Watch In The Current Stock Market Correction


Stocks To Watch: Cheniere, Eli Lilly, Exxon, Northrop

Cheniere Energy is one of the market’s top stocks to watch, even as it continues to trade below its 50-day line. Shares moved up 2.7% Friday, but remain below their 50-day line, as they continue to etch a flat base that shows a 149.52 buy point, according to IBD MarketSmith chart analysis. LNG shares moved up 1.1% Monday.

IBD Leaderboard stock Eli Lilly is holding just above a prior cup base’s 284 buy point and is trying to maintain its 50-day line. The stock’s RS line hit a new high last week. Eli Lilly stock was up 1% Monday morning.

Energy giant Exxon Mobil remains below a cup with handle’s 89.90 buy point despite a 3% gain on Friday. The stock found much-needed support at its key 50-day line. XOM shares inch higher Monday.

Defense contractor Northrop Grumman continues to etch a cup with a handle with a 477.36 buy point. Shares are just below their 50-day line after Friday’s 0.5% rise. Northrop shares were up 0.4% early Monday.


Join IBD experts as they analyze leading stocks in the current stock market correction on IBD Live


Tesla Stock

Tesla stock lost around 1% Monday morning following Friday’s near-6% advance. Shares remain sharply below their 50- and 200-day lines amid their recent weakness.

The stock traded as high as 1,243.49 on Nov. 4 and is about 38% away from that all-time high.

Dow Jones Leaders: Apple, Microsoft

Among Dow Jones stocks, Apple shares rallied more than 3% Friday after falling to their lowest level since October 2021 on Thursday. The stock is sharply below its 200-day line and about 20% off its 52-week high. Apple stock fell 0.9% Monday.

Software leader Microsoft ended a two-day slide Friday, rising 2.3%. The stock closed about 25% off its 52-week high. MSFT shares moved down 0.85% Monday morning.

Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.

YOU MAY ALSO LIKE:

Top Growth Stocks To Buy And Watch

Learn How To Time The Market With IBD’s ETF Market Strategy

Find The Best Long-Term Investments With IBD Long-Term Leaders

MarketSmith: Research, Charts, Data And Coaching All In One Place

How To Research Growth Stocks: Why This IBD Tool Simplifies The Search For Top Stocks

Categories
Business

This Weekly Chart Pattern Might Suggest That Shiba Inu Price Remains on Track

Shiba Inu continues to trade in a triangle pattern with support near $0.0000087, according to its weekly chart. While the price is looking set for incoming price movement within the triangle formation, the momentum indicators, especially the RSI, have flattened slightly above the 30 mark, suggesting the possibility of range trading.

Shiba Inu dipped to lows of $0.0000087 in the past week before slightly recovering. After intense selling pressure, buyers deemed Shiba Inu oversold and thus responded by pushing SHIB to highs of $0.0000143 on May 13. Shiba Inu remains in a tight trading range beneath $0.000014 as buyers seek potential entry points into the market. At the time of publication, SHIB was trading down 7% at $0.0000123 after setting intraday highs at $0.000013.

TradingView
SHIB/USD Weekly Chart, Courtesy: TradingView

Despite the recent declines, Shiba Inu have added new holders. According to WhaleStats, the total number of SHIB holders is currently 1,162,394. The cryptocurrency meme also recently hit the milestone of 3.3 million Twitter followers.

Per IntoTheBlock’s holders’ composition by time held, Shiba Inu “hodlers” referring to addresses that have held SHIB for more than a year, has increased by 12%. Presently, 83% of addresses have held for over a year, while 5% have held onto their tokens for barely less than a month. The greater chunk of Shiba Inu holders being mid- and long-term holders might suggest that SHIB may have been seeing buying pressure from this class.

ads

Shiba Inu now accepted by Unfranchise via BitPay

Shiba Inu is now accepted as payment by product brokerage company UnFranchisevia BitPay.

As reported previously, Shiba Inu’s main financial components, Shibarium, SHI and SHIBFE, are presently in development and are nearing completion. Shiba Inu lead developer Shytoshi Kusama indicated that one or two of these technologies might be expected before the end of summer or very early fall.

According to ShibaInuartLayer 2 scaling, Shibarium has a similar design to Polygon Network, thus presenting endless opportunities.

Categories
Business

JetBlue goes hostile to buy Spirit Airlines after rejection

CHICAGO/WASHINGTON, May 16 (Reuters) – JetBlue Airways Corp (JBLU.O) is not taking no for an answer in its quest to buy rival Spirit Airlines (SAVE.N).

On Monday, the New York-based carrier launched a hostile all-cash takeover bid for Spirit Airlines, two weeks after the low-cost carrier rejected an offer from the larger rival.

JetBlue, which in early April offered $33 per share, is locked in a takeover battle for Spirit with Frontier Group Holdings (ULCC.O) and has argued a deal will help better compete with the “Big Four” US airlines that control nearly 80% of the passenger market.

Register now for FREE unlimited access to Reuters.com

In a letter to Spirit shareholders on Monday, JetBlue offered $30 per share and said it was ready to “negotiate in good faith a consensual transaction at $33, subject to receiving necessary diligence.”

Spirit rejected the earlier offer, saying it had a low likelihood of winning approval from regulators. read more

JetBlue disclosed Monday that acquiring Spirit “has been a strategic objective of JetBlue for many years,” according to an April 29 letter it sent Spirit.

JetBlue said on Monday it had filed a “Vote No” proxy statement urging Spirit shareholders to vote against the planned merger with Frontier, which rose 4% in early trading. The value of Frontier’s cash and stock for each share of the discount carrier on Monday was recently at $19.48 a share.

Shares of Spirit rose 8% to $18.32 in early trading. JetBlue shares were down 3.4% to $9.72%

JetBlue said “Spirit’s Board is prioritizing its own self-interest and personal relationships with Frontier over its shareholders’ interests.”

It added “Ask yourself a simple question: why won’t the Spirit Board engage with us constructively? The interests of Bill Franke’s Indigo Partners and the long-standing relationships between the two companies is the obvious answer.”

Frontier, Spirit and Franke did not immediately respond to Reuters requests for comment.

Spirit will hold a shareholder meeting on June 10 to vote on its proposed merger with Frontier. read more

JetBlue said Monday that on March 29 its Chief Executive Robin Hayes first called Spirit Chief Executive Ted Christie to inform him of the airline’s interest in buying Spirit.

JetBlue, the sixth-largest US passenger carrier, would operate Spirit under the JetBlue brand and does not think any divestitures are needed, but promised a $200 million reverse break-up fee, or $1.80 per Spirit share, and plans to divest Spirit’s holdings in New York and Boston to address any overlap.

Spirit in April had sought a significantly higher reverse break-up fee, JetBlue said.

Register now for FREE unlimited access to Reuters.com

Reporting by Rajesh Kumar Singh in Chicago, Tanvi Mehta in Bengaluru and David Shepardson in Washington; Editing by Sriraj Kalluvila, David Evans and Lisa Shumaker

Our Standards: The Thomson Reuters Trust Principles.

.

Categories
Business

McDonald’s to sell its Russian business, try to keep workers

More than three decades after it became the first American fast food restaurant to open in the Soviet Union, McDonald’s said Monday that it has started the process of selling its business in Russia, another symbol of the country’s increasing isolation over its war in Ukraine.

The company, which has 850 restaurants in Russia that employ 62,000 people, pointed to the humanitarian crisis caused by the war, saying holding on to its business in Russia “is no longer tenable, nor is it consistent with McDonald’s values.”

The Chicago-based fast food giant said in early March that it was temporarily closing its stores in Russia but would continue to pay its employees. Without naming a prospective Russian buyer, McDonald’s said Monday that it would seek one to hire its workers and pay them until the sale closes.

CEO Chris Kempczinski said the “dedication and loyalty to McDonald’s” of employees and hundreds of Russian suppliers made it a difficult decision to leave.

“However, we have a commitment to our global community and must remain steadfast in our values,” Kempczinski said in a statement, “and our commitment to our values ​​means that we can no longer keep the arches shining there.”

As it tries to sell its restaurants, McDonald’s said it plans to start removing golden arches and other symbols and signs with the company’s name. It said it will keep its trademarks in Russia.

Western companies have wrestled with extricating themselves from Russia, enduring the hit to their bottom lines from pausing or closing operations in the face of sanctions. Others have stayed in Russia at least partially, with some facing blowback.

French carmaker Renault said Monday that it would sell its majority stake in Russian car company Avtovaz and a factory in Moscow to the state — the first major nationalization of a foreign business since the war began.

For McDonald’s, its first restaurant in Russia opened in the middle of Moscow more than three decades ago, shortly after the fall of the Berlin Wall. It was a powerful symbol of the easing of Cold War tensions between the United States and Soviet Union, which would collapse in 1991.

Now, the company’s exit is proving symbolic of a new era, analysts say.

“Its departure represents a new isolationism in Russia, which must now look inward for investment and consumer brand development,” said Neil Saunders, managing director of GlobalData, a corporate analytics company.

He said McDonald’s owns most of its restaurants in Russia, but because it won’t license its brand, the sale price likely won’t be close to the value of the business before the invasion. Russia and Ukraine combined accounted for about 9% of McDonald’s revenue and 3% of operating income before the war, Saunders said.

McDonald’s said it expects to record a charge against earnings of between $1.2 billion and $1.4 billion over leaving Russia.

Its restaurants in Ukraine are closed, but the company said it is continuing to pay full salaries for its employees there.

McDonald’s has more than 39,000 locations across more than 100 countries. Most are owned by franchisees — only about 5% are owned and operated by the company.

McDonald’s said exiting Russia will not change its forecast of adding a net 1,300 restaurants this year, which will contribute about 1.5% to companywide sales growth.

Last month, McDonald’s reported that it earned $1.1 billion in the first quarter, down from more than $1.5 billion a year earlier. Revenue was nearly $5.7 billion.

.

Categories
Business

Goldman Sachs gives top bankers unlimited vacation days

Senior bankers will now be able to take as many vacation days as they need, Goldman Sachs (GS) said in a memo to staff that was shared with CNN Business. And starting next year, all staff “will be expected to take a minimum of 15 days” away from work each year.

Bankers who haven’t yet made partner or managing director will remain on a fixed vacation allotment but will be granted two extra days starting next year.

“As a firm, we are committed to providing our people with differentiated benefits and offerings to support well-being and resilience,” the memo reads.

The new policy tracks with a growing trend toward flexibility on Wall Street. Banks are increasingly competing with startups, Big Tech and the crypto space to attract young talent. As a result, Wall Street is having to loosen its tie, literally, with less stringent dress codes, higher salaries and bonuses, and other overtures aimed at presenting a gentler, more worker-friendly image.

Goldman, in particular, has faced scrutiny over his work culture. A year ago, a group of first-year bankers told managers that they were working 100-hour weeks, sleeping just five hours a night and enduring workplace abuse that was having a serious affect on their mental health.
The bank responded at the time by saying it took the complaints seriously, and that it would speed up hiring and strengthen enforcement of rules aimed at preventing work on Saturdays.
The pandemic also sparked a tectonic shift in modern work culture. Across industries, workers are pushing back against stringent Monday-to-Friday office routines. Companies are responding with higher pay and greater flexibility — even on Wall Street.
Citibank (C), notably, has embraced a hybrid work schedule and encouraged staff to take their vacation time to avoid burnout. Citi’s CEO, Jane Fraser, who took the helm just over a year ago, has said that decision was both an ethical consideration and a strategic one — she’s positioning Citi as the cooler, more friendly Wall Street giant to gain an edge in the talent war .
Unlimited vacation policies are increasingly popular, but they have their critics. Some companies have found that workers, especially younger staff, end up taking fewer days off than they otherwise might out of a desire to provide their commitment. One study from 2018 found that employees with unlimited PTO take an average of 13 days off per year, while those with traditional plans average 15 days annually.

— CNN Business’ Anna Cooban contributed to this article.

.

Categories
Business

Golden arches to go dark in Russia as McDonald’s exits after 30 years

May 16 (Reuters) – McDonald’s Corp (MCD.N) on Monday became one of the biggest global names to exit Russia, laying out plans to sell all its restaurants after operating for more than 30 years in the country following its invasion of Ukraine.

The world’s largest burger chain, which owns about 84% of its nearly 850 restaurants in Russia, will take a related non-cash charge of up to $1.4 billion.

McDonald’s had in March decided to close its restaurants in the country, including the iconic Pushkin Square location in central Moscow – a symbol of flourishing American capitalism in the dying embers of the Soviet Union.

Register now for FREE unlimited access to Reuters.com

In the Russia of the early nineties, the burger chain became a way to sample Western food and spirit for millions of people, even though the cost of one burger was several times bigger than many city dwellers’ daily budgets.

“Some might argue that providing access to food and continuing to employ tens of thousands of ordinary citizens is surely the right thing to do,” Chief Executive Chris Kempczinski said in a letter to employees. “But it is impossible to ignore the humanitarian crisis caused by the war in Ukraine.”

Though a vast majority of the stores in Russia are closed, a few franchised stores have stayed open, cashing in on its skyrocketing popularity. It generated about 9%, or $2 billion, of its revenue from Russia and Ukraine last year.

Over the weekend, long, snacking queues were seen at the restaurant in Moscow’s Leningradsky Station, one of the capital’s only branches that has remained open, social media footage showed.

A logo of the McDonald’s restaurant is seen in the window with a reflection of Kremlin’s tower in central Moscow, Russia March 9, 2022. REUTERS/Maxim Shemetov

McDonald’s said it was looking to sell its restaurants in Russia to a local buyer, but will retain its trademarks.

“Given the circumstances of the sale, the financial challenges faced by potential Russian buyers, and the fact that McDonald’s will not license its brand name or identity, it is unlikely the sale price will be anywhere near the pre-invasion book value of the business ,” Neil Saunders, managing director of GlobalData, said.

McDonald’s said it would ensure its 62,000 employees in Russia continue to be paid until the close of any transaction and that they have future jobs with any potential buyer.

After McDonald’s decision to close stores in March, several American brands including Starbucks Corp (SBUX.O), PepsiCo Inc (PEP.O) and Coca-Cola Co (KO.N) followed suit, scrambling to comply with sanctions and deal with threats from the Kremlin that foreign-owned assets may be seized. read more

“I would not be surprised to see other companies follow McDonald’s lead of exiting the market,” Edward Jones analyst Brian Yarbrough said.

Earlier in the day, French carmaker Renault (RENA.PA) said it would sell its majority stake in Avtovaz (AVAZI_p.MM) to a Russian science institute. read more

(This story refers to add dropped word in paragraph 2)

Register now for FREE unlimited access to Reuters.com

Reporting by Uday Sampath and Deborah Sophia in Bengaluru; Editing by Sriraj Kalluvila and Arun Koyyur

Our Standards: The Thomson Reuters Trust Principles.

.

Categories
Business

5 things to know before the stock market opens Monday, May 16

Here are the most important news, trends and analysis that investors need to start their trading day:

1. Dow set to open slightly higher after 7 straight weeks of selling

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, US, May 13, 2022.

Brendan Mcdermid | Reuters

US stock futures turned slightly positive Monday after the Dow Jones Industrial Average declined for a seventh week in a row, the first time that’s happened in more than two decades. The S&P 500 and the Nasdaq both dropped for six straight weeks for the first time since 2011 and 2012, respectively.

  • Despite Friday’s strong rally, led by the Nasdaq’s 3.8% advance, all three stock benchmarks finished with weekly losses of more than 2%. The Nasdaq remained in a bear market, with the Dow and the S&P 500 both in sharp corrections.
  • The 10-year Treasury yield was steady Monday, just under 3%. US oil prices dipped but were still roughly $109 per barrel. Crypto fell again, with bitcoin at roughly $30,000 early Monday.
  • Retail earnings kick off Tuesday and the government is out with April retail sales data. Investors hope to gain insight from these reports on how consumers are reacting to rising inflation and whether the Federal Reserve might be swayed to act more aggressively in hiking interest rates to stamp out price pressures.
  • Former Fed Chairman Ben Bernanke said the current central bank erred in waiting to address inflation. “One of the reasons was that they wanted not to shock the market,” he told CNBC’s Andrew Ross Sorkin in an interview that ran on television Monday.

2. JetBlue goes hostile with its Spirit Airlines takeover offer

A JetBlue airliner lands past a Spirit Airlines jet on taxi way at Fort Lauderdale Hollywood International Airport on Monday, April 25, 2022. (Joe Cavaretta/Sun Sentinel/Tribune News Service via Getty Images)

Joe Cavaretta | Sun Sentinel | Getty Images

JetBlue Airways on Monday took its all-cash offer to buy Spirit Airlines hostile. In a letter to Spirit shareholders, JetBlue offered $30 per share and wrote it was ready to go to $33 if the board engages to negotiate a “consensual transaction.” Shares of Spirit rose nearly 10% to more than $18 per share in premarket trading, far lower than the offer prices.

  • Earlier this month, Spirit rejected JetBlue’s all-cash offer of $33 per share, or $3.6 billion, citing regulatory concerns. At the time, Spirit said it was sticking with a deal to merge with fellow ultra-low-cost carrier Frontier Airlines, an agreement struck in February valued at $2.9 billion.

3. McDonald’s to sell its Russia business due to Putin’s Ukraine war

A woman walks along a street past a banner offering job at McDonald’s in the town of Pokrov in Vladimir Region, Russia March 21, 2022.

Evgenia Novozhenina | Reuters

McDonald’s said Monday it will sell its business in Russia, a little more than two months after it paused operations in the country due to its unprovoked invasion of Ukraine. McDonald’s said its “continued ownership of the business in Russia is no longer tenable,” and it’s not consistent with its values.

McDonald’s first opened in Russia 32 years ago. It has more than 800 restaurants and 62,000 employees in Russia. The company said it’s seeking a local buyer. The McDonald’s announcement Monday is a stark indication of how much the Western world has turned against Russian President Vladimir Putin’s regime.

4. Tesla said to be delaying its Shanghai production ramp-up

A truck leaves the Tesla Shanghai Gigafactory on April 25, 2021 in Shanghai, China.

Visual China Group | Getty Images

Tesla has delayed by at least a week a plan to restore production at its Shanghai plant to levels before the city’s Covid lockdown more than six week ago, according to Reuters, citing an internal memo. Companies in Shanghai, China’s biggest city, are only allowed to reopen if they can operate under such an arrangement, which requires workers to be isolated.

Shanghai aims to reopen broadly and allow normal life to resume from June 1, a city official said Monday, after declaring that 15 of its 16 districts had eliminated cases outside quarantine areas. In Beijing, dozens of new Covid cases have been discovered every day for the past three weeks. The Chinese capital is not under a citywide lockdown but is subject to virus mitigation curbs.

5. Elon Musk says Twitter’s legal team came after him over bot tweet

Elon Musk, CEO of Tesla and SpaceX, tweeted on Saturday that Twitter’s legal team accused him of violating a nondisclosure agreement by revealing the sample size for the social media platform’s checks on automated users. “Twitter legal just called to complain that I violated their NDA by revealing the bot check sample size is 100,” he wrote.

Musk on Friday tweeted that his $44 billion cash deal to take the company private was “temporarily on hold” while he awaited data on the proportion of its fake accounts. In a second tweet Friday, he said he was “still committed” to the deal. Shares of Twitter fell more than 2% in Monday’s premarket after a roller-coaster ride Friday.

— CNBC’s Tanaya Macheel, abigail ng, Samantha Subin, Jesse Pound, Leslie Josephs and Mike Calia as well as Reuters contributed to this report.

sign up now for the CNBC Investing Club to follow Jim Cramer’s every stock move. Follow the broader market action like a pro on CNBC-Pro.

.

Categories
Business

FDA Approves Tirzepatide Injection for Adults With Type 2 Diabetes

Tirzepatide is a once-weekly glucose-dependent insulinotropic polypeptide and glucagon-like peptide-1 receptor agonist indicated as an adjunct to diet and exercise in adults with type 2 diabetes.

The FDA has approved tirzepatide (Mounjaro; Eli Lilly and Company), a novel, dual-targeted treatment shown to improve glycemic control in adults with type 2 diabetes. The once-weekly glucose-dependent insulinotropic polypeptide (GIP) and glucagon-like peptide-1 (GLP-1) receptor agonist is indicated as an adjunct to diet and exercise in adults with type 2 diabetes.one

The drug has not been studied in patients with a history of pancreatitis and is not indicated for use in patients with type 1 diabetes mellitus, according to Eli Lilly.

“Type 2 diabetes is a chronic and progressive condition that requires continued innovation to help people manage their blood glucose and weight,” said Mike Mason, president, Lilly Diabetes, in a press release. “[The] FDA approval underscores our commitment to the discovery and development of new treatment pathways, and we are thrilled to bring this new and innovative treatment option to people living with type 2 diabetes.”

Tirzepatide is a multi-functional peptide based on the native GIP peptide sequence, although it has been modified to bind to both GIP and GLP-1 receptors. It has a mean half-life of approximately 5 days, making once-weekly dosing possible.

Clinical trial data show tirzepatide is effective at improving blood sugar more effectively than other diabetes treatments. The SURPASS trials showed encouraging results with tirzepatide in various patient populations. The drugs were tested as either a stand-alone therapy or as an add-on to other medications.two

SURPASS-1 was a randomized, controlled, double-blind trial comparing the results of tirzepatide with placebo in adults with uncontrolled type 2 diabetes. In the trial, 705 patients were screened and 478 were randomized between groups to receive either tirzepatide or a placebo. Within the tirzepatide group, patients received either 5 mg, 10 mg, or 15 mg, and all 3 doses were associated with a superior reduction in A1c compared to placebo.two

Participants receiving the highest dose achieved a reduction of 2.7%, and between 87% and 92% of tirzepatide-treated patients achieved an A1c target of less than 7%. Furthermore, between 13% and 27% of patients receiving tirzepatide achieved weight loss of at least 15% of body weight, and overall adverse effects (AEs) were balanced between the groups. Investigators found robust reductions in glycemic control as well as body weight, and normoglycemia (defined as <5.7%) was achieved in at least one-third of participants.two

The SURPASS-2 trial found similarly encouraging results comparing tirzepatide with once-weekly semaglutide as an add-on therapy to metformin in patients with type 2 diabetes. Approximately 470 patients were included in each of the 4 treatment groups and between 94% and 96% completed the study.

Reductions in A1c were observed as early as week 4 in the tirzepatide group and ranged from -0.2% to -0.6% with the 15 mg dose compared to semaglutide. A greater proportion of tirzepatide patients achieved HbA1c goals at 40 weeks compared to semaglutide and a significantly greater proportion of patients in the tirzepatide arm achieved their weight loss goals.

SURPASS-5 compared the efficacy and safety of 3 tirzepatide doses versus placebo as an add-on to insulin glargine with or without metformin. Participants had an average age of 60 years, and 44% were female, 80% were Caucasian, and 18% were Asian. The average length of diabetes was 13.3 years with a baseline A1c of 8.3%.

Over the 40-week study period, investigators observed between a 2.2% and 2.9% decrease in A1c in the tirzepatide arm. In the arm receiving placebo and titrated insulin glargine, there was an expected increase in body weight with a corresponding decrease in the tirzepatide arm. Between 8% and 32% of patients achieved 15% or more body weight loss.

All doses of tirzepatide were superior to placebo at 40 weeks for change from baseline in HbA1c as well as change from baseline in body weight. The most common AEs with tirzepatide were gastrointestinal in nature, were mostly mild to moderate in severity, and decreased over time.

Treatment with tirzepatide also resulted in an average weight loss of 15 pounds more than placebo when both were used with insulin, with an average weight loss with the 15 mg dose of 12 pounds more than semaglutide, 29 pounds more than insulin degludec and 27 pounds more than insulin glargine.

“Mounjaro delivered superior and consistent A1C reductions against all of the comparators throughout the SURPASS program, which was designed to assess Mounjaro’s efficacy and safety in a broad range of adults with type 2 diabetes who could be treated in clinical practice. The approval of Mounjaro is an exciting step forward for people living with type 2 diabetes given the results seen in these clinical trials,” SURPASS program investigator Juan Pablo Frías, MD, medical director, National Research Institute, said in a press release.

references

1. FDA approves Lilly’s Mounjaro™ (tirzepatide) injection, the first and only GIP and GLP-1 receptor agonist for the treatment of adults with type 2 diabetes. Eli Lilly. News release. May 13, 2022. https://investor.lilly.com/news-releases/news-release-details/fda-approves-lillys-mounjarotm-tirzepatide-injection-first-and

2. Antrim, A. Tirzepatide Shows Significant Improvements in Glycemic Control, Weight Loss Among Patients with Type 2 Diabetes. PharmacyTimes. June 29, 2021. https://www.pharmacytimes.com/view/tirzepatide-shows-significant-improvements-in-glycemic-control-weight-loss-among-patients-with-type-2-diabetes

Categories
Business

Gloomy Goldman offers 20 ‘safety’ stocks with valuations below the previous 2 bear markets

It’s tight quarters in Wall Street’s bear sleuth these days.

Goldman Sachs just downgraded their 2022 US growth forecast (to 2.4% from 2.6%) and 2023 (to 1.6% from 2.2%), as senior chairman Lloyd Blankfein warned of “very, very high” risks for a US recession.

“If I were running a big company, I would be very prepared for it. If I was a consumer, I’d be prepared for it,” he said over the weekend.

Also one of the most bullish banks on Wall Street headed into this year, Goldman cut its end-2022 S&P 500 target to 4,300. Their new baseline forecast assumes no recession, but if that happens, expect a drop to 3,600, they say.

“Although S&P 500 firms posted much better-than-expected 1Q EPS growth of 11%, investors have been mauled by a 18% near-bear market plunge since the index peaked on January 3rd,” said chief US equity strategist David Kostin, in make a note of.

Their consolation prize and our call of the day is a list of 20 stocks with valuations below previous bear market lows.

Those companies also have size and liquidity — an above-average market cap is needed for uncertain times — and balance sheet strength, meaning they are typically less sensitive to an economic slowdown because they can withstand a fall in credit market liquidity, said Kostin and the team.

As for that attractive valuation, the metric is explained like this: the price/earnings multiple after a 20% haircut to expected 2023 earnings is below the forward p/e at the bottom of either or both of the March 2009 and March 2020 bear markets .

“Importantly, given the different real interest rate environments, the highlighted stocks are more attractively valued today on a yield gap basis relative to the rest of the index than they were in either 2009 or 2020,” said Kostin and the team.

And the stocks on this list, after a potential 20% reduction in 2023 EPS, would still have 2021-2023E compound annual growth earnings per share growth rate of 4% compared with -2% for the median S&P 500 company.

uncredited

Read: ‘No where to hide?’ What’s next as stocks slump toward bear market amid stagflation fears

buzz

It’s da svidanya to Russia for McDonald’s MCD
as the fast-food giant announced plans to exit from the country and sell its business there, which could cost it up to $1.4 billion. McDonald’s also wants to secure jobs for its 62,000 workers there.

Tesla’s TSLA
Elon Musk said Twitter’s TWTR
legal team has accused him of breaking a nondisclosure agreement over bots, following his Friday announcement that a $44 billion deal for the social media group is on hold.

Stringent COVID lockdowns triggered slumping retail sales and industrial production in China, both data sets the weakest since March 2020, points out Deutsche Bank.

It’s a big week for retailer results, with Walmart WMT
(see preview), Home Depot HD
and Target TGT
on tap. Take-Two Interactive TTWO
will report results after Monday’s close.

The Empire State Manufacturing index for May is ahead. The week’s other big data will be Tuesday’s release of retail sales for April.

The markets

uncredited

US stock futures ES00

YM00

NQ00
are down after that China data, oil prices CL00

BRN00
are down, while Treasury yields BX:TMUBMUSD10Y

BX:TMUBMUSD02Y
are flat to weaker. The dollar DXY
and gold GC00
are lower, and bitcoin BTCUSD
is weaker, trading just under $30,000 with most cryptocurrencies under modest pressure.

Read: Crypto investor Barry Silbert offers sympathy and advice to those who have lost fortunes last week

The tickers

These were the top-searched tickers on MarketWatch as of 6 am Eastern Time:

Random reads

Goldman Sachs’ senior bankers have been told to take all the vacations they want

A Thai beach cove made famous by Leonardo di Caprio is reopening. But you may not be visiting anytime soon.

Need to Know starts early and is updated until the opening bell, but sign up here to get it delivered once to your email box. The emailed version will be sent out at about 7:30 am Eastern.

Want more for the day ahead? Sign up for The Barron’s Daily, a morning briefing for investors, including exclusive commentary from Barron’s and MarketWatch writers.

.

Categories
Business

Spirit Airlines, Carvana, Warby Parker and more

Take a look at some of the biggest movers in the premarket:

Spirit Airlines (SAVE) – Spirit Airlines surged 19.3% in premarket trading after JetBlue (JBLU) launched a $30 per share tender offer for its rival airline. Spirit had rejected a prior bid by JetBlue, preferring to keep a previously struck deal to merge with Frontier Airlines parent Frontier Group (ULCC). Frontier shares jumped 5.5% while JetBlue was down 0.6%.

Carvana (CVNA) – Carvana shares rallied 13.3% in premarket action after the used car retailer forecast significant core earnings for 2023. In a Securities and Exchange Commission filing, Carvana also detailed its plans to cut costs.

Warby Parker (WRBY) – The eyewear retailer’s stock slipped 3.8% in the premarket after the company reported an unexpected quarterly loss as well as revenue that came in slightly below forecasts. Warby Parker reiterated his prior full-year outlook.

Twitter (TWTR) – Twitter fell 2% in the premarket, amid speculation about whether Elon Musk will complete his takeover deal for the social media platform. Musk tweeted over the weekend that Twitter’s lawyers told him he had violated a non-disclosure agreement by revealing sample sizes used by Twitter when it analyzes spam accounts.

Netflix (NFLX) – Netflix added 1.8% in premarket trading after Wedbush upgraded the stock to “outperform” from “neutral.” The firm said the staggered release of shows like “Ozark” and “Stranger Things” will help reduce churn and that it believes Netflix is ​​once again positioned to grow.

Rivian (RIVN) – Ford Motor (F) sold another 7 million shares of the electric vehicle maker, according to an SEC filing. That follows the sale of 8 million shares last week, with the two sales leaving Ford with a 9.7% stake. Rivian lost 1.1% in premarket trading.

SoFi (SOFI) – The fintech firm’s shares rallied 4.2% in the premarket after Piper Sandler upgraded it to “overweight” from “neutral.” The firm said SoFi will benefit from rapid growth in deposits, the expiration of the student loan moratorium and revenue growth in financial services.

ManTech International (MANT) – Carlyle Group (CG) is close to finalizing a roughly $4 billion buyout of defense contractor ManTech, according to people familiar with the matter who spoke to Bloomberg. A deal could be announced as soon as this week.

Trade Desk (TTD) – The programmatic advertising company’s stock added 3.3% in premarket trading after Stifel Financial upgraded it to “buy” from “hold” and increased its price target to $80 per share from $50 a share. Stifel said The Trade Desk will benefit from the addition of ad-supported versions of Netflix and Disney+.

.