The R&D Index: Market Watch for the week ending March 10, 2017 closed at 1,643.95 for the 25 companies in the R&D Index. The Index was down -0.19% (or -3.21 basis points) over the week ending March 3, 2017. Nine R&D Index companies gained value last week from 0.03% (Intel) to 3.90% (Qualcomm). Sixteen R&D Index companies lost value last week from -0.02% (Oracle) to -3.66% (General Motors).
The big economic news last week was the jobs report for February issued by the Dept. of Labor on Friday. Non-farm payrolls increased by 235,000 over January according to the report, which exceeded analysts expectations. For 2017, jobs have increased by an average of 237,000/month, compared to a monthly average of 187,000 for all of 2016. However, the current job increases are still below those cited before the 2009 great recession period. The Labor Dept. also noted that the unemployment rate for February dropped to 4.7% from January’s 4.8%. Average hourly earnings in the private sector also rose by 2.8% from a year earlier. These positive economic indicators ensure that the Federal Reserve will increase short-term interest rates on Wednesday, March 15 to approximately 1.0% from the current 0.75% rate which was announced in December 2016.
R&D Index member IBM announced last week that it has agreed to mingle their artificial intelligence (AI) technologies with those of Salesforce.com Inc. to increase their overall sales of data analytics software. IBM’s Watson products will be integrated with Salesforce’s Einstein technologies. The announcement follows a report that a collaboration of IBM and the Univ. of Texas MD Anderson Cancer Center had failed to achieve noticeable AI results after five years with the Watson system.
R&D Index member Bristol-Myers Squibb (BMS) announced last week that its R&D chief Francis Cuss was retiring and being replaced by Thomas Lynch, Jr., a BMS board member, cancer researcher and physician oversight executive for Boston’s Massachusetts General Hospital. BMS has been struggling to recover from the failure of its immunotherapy drug Opdivo to perform significantly better than traditional chemotherapy treatments in clinical trials of untreated lung-cancer patients. BMS stock fell more than third following the August 2016 Opdivo results and while there has been a slight recovery, BMS stock is still trading at 15% less than it did in early 2016.
Negatively affecting future economic growth was last week’s announcement by the Commerce Dept. of the largest trade imbalance in January in nearly five years. A negative trade balance of $48.5 billion was posted in January (the highest since March 2012) which was attributed to such items as semiconductors, cell phones, autos and oil. The current strong dollar situation could also be attributed to the the trade imbalance, according to analysts, which also affected the trade balance in final three months of 2016.
R&D Index Week Ending March 10, 2017
| Ticker | Exchange | 2015 R&D billions$ | 03/03/17 | 03/10/17 | 3/10/17 to 3/3/17 | 3/10/17 to 1/1/16 | ||
| 1 | Microsoft | MSFT | NASDAQ | 12,448 | 64.25 | 64.93 | 1.06% | 17.03% |
| 2 | Intel | INTC | NASDAQ | 12,128 | 35.90 | 35.91 | 0.03% | 4.24% |
| 3 | Roche Pharm | RHHBY | OTC | 10,242 | 32.42 | 32.04 | -1.17% | -7.05% |
| 4 | Toyota | TM | NYSE | 9,112 | 113.34 | 112.66 | -0.60% | -8.44% |
| 5 | Johnson & Johnson | JNJ | NYSE | 9,046 | 123.79 | 126.21 | 1.95% | 22.87% |
| 6 | Novartis | NVS | NYSE | 8,935 | 75.92 | 75.60 | -0.42% | -12.17% |
| 7 | Apple | AAPL | NASDAQ | 8,397 | 139.78 | 139.14 | -0.46% | 32.19% |
| 8 | Pfizer | PFE | NYSE | 7,690 | 34.52 | 34.11 | -1.19% | 5.31% |
| 9 | General Motors | GM | NYSE | 7,500 | 38.23 | 36.83 | -3.66% | 8.29% |
| 10 | Merck & Co. | MRK | NYSE | 6,704 | 66.58 | 65.60 | -1.47% | 24.20% |
| 11 | Ford Motor | F | NYSE | 6,700 | 12.65 | 12.53 | -0.95% | -11.07% |
| 12 | Cisco | CSCO | NASDAQ | 6,411 | 34.29 | 34.26 | -0.09% | 26.14% |
| 13 | Oracle | ORCL | NYSE | 6,042 | 42.69 | 42.68 | -0.02% | 16.84% |
| 14 | Astra Zeneca PLC | AZN | NYSE | 5,997 | 29.92 | 29.55 | -1.24% | -12.96% |
| 15 | Honda | HMC | NYSE | 5,990 | 31.15 | 31.05 | -0.32% | -2.76% |
| 16 | Bristol-Myers Squibb | BMY | NYSE | 5,920 | 57.26 | 58.32 | 1.85% | -15.23% |
| 17 | Qualcomm | QCOM | NASDAQ | 5,833 | 56.44 | 58.64 | 3.90% | 17.33% |
| 18 | Sanofi SA | SNY | NYSE | 5,519 | 44.24 | 43.91 | -0.75% | 2.95% |
| 19 | Eli Lilly Co | LLY | NYSE | 5,331 | 83.78 | 84.36 | 0.69% | 0.14% |
| 20 | GlaxoSmithKline | GSK | NYSE | 5,250 | 41.99 | 41.37 | -1.48% | 2.53% |
| 21 | IBM | IBM | NYSE | 5,247 | 180.05 | 177.83 | -1.23% | 29.26% |
| 22 | Daimler | DDAIY | OTC | 5,169 | 69.97 | 70.00 | 0.04% | -10.14% |
| 23 | Siemens | SIE | XETRA | 4,929 | 124.75 | 123.05 | -1.36% | 36.90% |
| 24 | Bayer AG | BAYN | XETRA | 4,649 | 106.65 | 106.75 | 0.09% | -8.13% |
| 25 | Ericsson | ERIC | NASDAQ | 4,124 | 6.60 | 6.62 | 0.30% | -31.11% |
| Total | 175,313 | 1647.16 | 1643.95 | -0.19% | 8.04% | |||
| Biopharmaceutical | 697.07 | 697.82 | 0.11% | 0.45% | ||||
| Automotive | 265.34 | 263.07 | -0.86% | -6.37% | ||||
| ICT | 553.40 | 553.39 | 0.00% | 23.96% | ||||
