What’s News in Markets: Amgen’s Prognosis, Quantum Boost, iPhone Makeover
5m 29s
Stock markets faced significant volatility during the week due to inflation fears and geopolitical tensions, which drove bond yields up and increased borrowing costs. The 10-year Treasury yield climbed nearly 5%, prompting stock declines as safer government bonds became more attractive. The S&P 500 and NASDAQ both declined, with healthcare suffering the worst performance after Novartis’ clinical trial failed to show reduced heart events despite lowering LDL cholesterol. This outcome raised serious concerns about Amgen’s similar drug development, causing both companies’ shares to drop more than 13%. In contrast, quantum computing firms gained traction after receiving $100 million in federal funding, with D-Wave and Regetti seeing notable stock gains, though the technology remains in early stages. Meanwhile, Apple’s announcement of its first foldable iPhone, priced at $1,999—the most expensive iPhone ever—sparked mixed reactions; initial market skepticism was offset by strong demand projections, leading to a nearly 4% weekly gain in Apple shares and a sharp rise for supplier Skyworks. Despite a weak debut, the device’s potential market share—projected at 44% of foldable revenue—bolstered investor confidence, highlighting the impact of strategic tech investments and consumer demand signals on stock performance.
Hey listeners, it's Saturday, September 12th. I'm Imani Moise for the Wall Street Journal, and this is what's news in markets. Our look at the biggest stock moves of the week, and the news that drove them. Let's dive in! It was a rough week for stocks, with intensifying pressures from inflation sending the bond market into a tailspin. The war with Iran pushed oil above $100 a barrel, feeling concerns that higher prices would lead to higher interest rates. The yield on the 10-year treasury climbed nearly 5 percent, and Friday's inflation report only reinforced expectations that the Federal Reserve will raise rates next week. Higher yields put pressure on the stock market by raising the cost of borrowing, while making relatively safe government bonds more attractive. Still, investors welcomed the prospect of the Fed getting inflation under control, helping stocks rebound Friday after four straight days of declines. Overall, the NASDAQ fell 2/3 of a percent for the week, while the S&P 500 lost 0.8%, and the Dow finished the week 1.6% lower. Healthcare was the worst-performing sector in the S&P this week, following more than 3.5%, after one-bale drug trial sent shockwaves through the industry. Amgen shares plunged 10% on Tuesday for their worst day in more than 25 years. But here's the thing, it wasn't Amgen's drug that failed. Swiss drug maker Novartis said an experimental heart disease treatment failed a late-stage clinical trial. The drug successfully lowered levels of a type of bad cholesterol called L.P. Little A, but that didn't translate into fewer heart attacks, strokes, or deaths. The results from Novartis raised questions about whether lowering L.P. Little A can actually prevent cardiovascular problems. That's potentially bad news for Amgen, because it's developing a similar treatment that also works by targeting the same risk factor. One Barclays analyst called the trial results, quote, "the worst possible outcome for Amgen." For the week, Amgen and Novartis stock both tumbled more than 13.5%. Some of the standout winners in the stock market this week were quantum computing companies. Even though quantum computing itself still isn't ready for prime time. Shares of D-Wave Quantum, Regetti Computing, and Quentinium rallied after a federal agency awarded each company $100 million, in exchange for minority stakes in all three. The money is meant to support research and development in quantum computing, which uses physics to tackle complex problems that conventional computers struggle with. The hope is that it could eventually transform industries from medicine to cybersecurity. But today's quantum computers are still limited in prone to errors. The investment is the latest example of Washington putting taxpayer money behind technologies it considers strategically important. The government already owns 10% of chip maker Intel, and this week, WSJ exclusively reported that the Pentagon was in talks to lend roughly $5 billion to AI infrastructure startup fluid stack, by far the largest loan ever considered by the office behind the deal. Since for those quantum companies, D-Wave ended the week 1.3% higher, and Regetti gained about half a percent, while Quentinium gave back its post-announcement gains and finished 1.3% lower. And one number that caught investors' attention this week was $1,999. Such a surprise in dollars of Apple's new iPhone duo, the company's first foldable phone, and the iPhone's biggest makeover since launching in 2007. It's also Apple's most expensive iPhone ever, costing more than some of its computers. Convincing customers to pay MacBook Pro money for a phone upgrade could be a tough sell, especially since the category hasn't exactly taken off. Apple phones have been around for about 7 years, but shipments actually fell 15% in the first half of this year. Apple shares slipped by less than half a percent on announcement day, but that's actually pretty typical. Apple stock underperformed the S&P on each of its previous 5 iPhone reveal days. Historically, investors have tended to warm up to new iPhones in the weeks after their debut. This time, the turnaround came a lot faster. Cash jumped on Thursday after an analyst report said the duo's design could drive stronger than expected demand. On top of that, IDC expects Apple to capture 44% of all foldable phone revenue this year, even though it launches with just three months left to go. Apple shares finished the week up nearly 4%, and Apple's supplier Skyworks jumped more than 19%. And now you know what's news in markets this week. You can read about more stocks that moved on the week's news in our live markets coverage on WSJ.com. Today's show is produced by PRB Anime with Deputy Editor Chris Inslee, Ami Moni-Malise, have a great weekend, and see you next Saturday.
Podcast Summary
Key Points:
Rising inflation and war-related oil price spikes pushed bond yields higher, especially the 10-year Treasury, increasing borrowing costs and pressuring stock markets.
Novartis' failed late-stage heart disease trial, which failed to reduce heart attacks or deaths despite lowering bad cholesterol, raised doubts about similar treatments from Amgen, leading both companies to lose over 13.5% in stock value.
Quantum computing firms saw strong gains after federal investment, with D-Wave, Regetti, and Quentinium benefiting from $100 million stakes, though the technology remains immature and error-prone.
Summary:
Stock markets faced significant volatility during the week due to inflation fears and geopolitical tensions, which drove bond yields up and increased borrowing costs. The 10-year Treasury yield climbed nearly 5%, prompting stock declines as safer government bonds became more attractive. The S&P 500 and NASDAQ both declined, with healthcare suffering the worst performance after Novartis’ clinical trial failed to show reduced heart events despite lowering LDL cholesterol.
This outcome raised serious concerns about Amgen’s similar drug development, causing both companies’ shares to drop more than 13%. In contrast, quantum computing firms gained traction after receiving $100 million in federal funding, with D-Wave and Regetti seeing notable stock gains, though the technology remains in early stages. Meanwhile, Apple’s announcement of its first foldable iPhone, priced at $1,999—the most expensive iPhone ever—sparked mixed reactions; initial market skepticism was offset by strong demand projections, leading to a nearly 4% weekly gain in Apple shares and a sharp rise for supplier Skyworks.
Despite a weak debut, the device’s potential market share—projected at 44% of foldable revenue—bolstered investor confidence, highlighting the impact of strategic tech investments and consumer demand signals on stock performance.
FAQs
Stocks fell due to rising inflation fears, which pushed bond yields higher, increasing borrowing costs and making government bonds more attractive. The war with Iran also drove oil prices above $100 per barrel, fueling concerns about higher interest rates.
Healthcare was the worst-performing sector, with Amgen and Novartis shares dropping over 13.5%. The downturn followed Novartis' failed late-stage trial for a heart disease drug that didn't reduce heart attacks or deaths, raising doubts about similar treatments being effective.
Amgen's stock plummeted because its drug targets the same risk factor as Novartis' failed treatment. The failure of Novartis' clinical trial raised serious questions about whether lowering LDL cholesterol can prevent heart problems, which could impact Amgen's product development.
Quantum computing companies like D-Wave Quantum, Regetti Computing, and Quentinium rallied after receiving $100 million in government funding for research and development, despite the technology still being in early stages.
Apple launched its first foldable phone priced at $1,999, the most expensive iPhone ever. While initial sales were uncertain, strong demand forecasts and market expectations led to a nearly 4% stock gain by week's end.
Apple shares initially dipped, but later rose nearly 4% as demand forecasts improved. Analysts predicted Apple would capture 44% of global foldable phone revenue, and suppliers like Skyworks saw a significant stock gain.
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