The 25 companies in the R&D Market Pulse Index for the week ending October 13, 2017 closed at 3,618.42. The Index was up 1.03% (or 36.91 basis points) over the week ending October 6, 2017. Nineteen R&D Index companies gained value last week from 0.10% (Intel) to 2.41% (Johnson & Johnson). Six R&D Index companies lost value last week from -0.61% (Eli Lilly) to -2.14% (Sanofi).
R&D Index member Bayer AG agreed last week to sell parts of its crop science business to BASF for nearly $7 billion. The sale was performed in part to offset regulator concerns on Bayer’s purchase of U.S. crop company Monsanto, which is being heavily scrutinized by European, Brazilian and U.S. regulators. The Bayer-Monsanto deal is scheduled to be completed in spring 2018 and the BASF purchase is contingent on completion of that deal.
The Dept. of Labor reported last Friday that consumer prices rose just 0.5% in September from August prices. Much of this increase was due to the increase in gasoline prices due to Hurricane Harvey’s effect on Houston-based refineries’ drop in capacity. These low inflation rates have caused vocal concerns among some Federal Reserve members that the planned December interest rate increase may not be appropriate at this time. Most analysts, however, still feel that the December rate hike will happen despite the low inflation rates (below the Fed’s 2.0% inflation target) to avoid playing ‘catch-up’ in 2018 to rising inflation rates if they do occur.
France’s largest bank, BNP Paribas, stated last week that it would no longer finance shale and oil sand projects in all aspects of their businesses. This message was intended to transition energy development to technologies that emit fewer greenhouse gases. Earlier this year, BNP Paribas also moved to reduce its financing of coal mines and coal-fired power plants.
China’s once-every-five-years party congress begins on October 18th and is expected to determine the communist leadership and policy directions in China for the next five years. Chinese economic market regulators have taken steps over the past several months to ensure stocks remain stable (termed ‘wei wen’ in Chinese) and limit large market swings ahead of the party congress. As a result, volatility in Chinese shares has dropped to multiyear lows and the yuan has seen limited changes in trading against the U.S. dollar.
In other Asian economic news, Japan’s Nikkei Stock Average closed last week at a 20-year high (20,881, up 9.2% in 2017) driven by strong corporate earnings, an improved economy and increased investor confidence.
R&D Index Week Ending October 13, 2017 |
Ticker | Exchange | 2017 R&D billions$ | 10/06/17 | 10/13/17 | 10/13/17 to 10/6/17 | 10/13/17 to 1/1/17 | ||
1 | Amazon | AMZN | NASDAQ | 17,774 | 989.58 | 1,002.94 | 1.35% | 33.75% |
2 | Alphabet/Google | GOOGL | NASDAQ | 15,845 | 993.64 | 1,007.87 | 1.43% | 27.18% |
3 | Microsoft | MSFT | NASDAQ | 13,987 | 76.00 | 77.49 | 1.96% | 24.70% |
4 | Intel | INTC | NASDAQ | 13,499 | 39.63 | 39.67 | 0.10% | 9.37% |
5 | Apple | AAPL | NASDAQ | 11,506 | 155.30 | 156.99 | 1.09% | 35.55% |
6 | Volkswagen AG | VLKAY | OTC | 11,260 | 34.80 | 35.23 | 1.24% | 22.84% |
7 | Roche Pharm | RHHBY | OTC | 10,174 | 31.73 | 31.41 | -1.01% | 10.09% |
8 | Toyota | TM | NYSE | 9,170 | 121.87 | 123.38 | 1.24% | 5.27% |
9 | Johnson & Johnson | JNJ | NYSE | 9,060 | 133.22 | 136.43 | 2.41% | 18.42% |
10 | Novartis | NVS | NYSE | 7,870 | 85.77 | 86.13 | 0.42% | 18.25% |
11 | General Motors | GM | NYSE | 7,468 | 44.93 | 45.88 | 2.11% | 31.69% |
12 | Pfizer | PFE | NYSE | 7,288 | 36.05 | 36.34 | 0.80% | 11.88% |
13 | Bristol-Myers Squibb | BMY | NYSE | 6,942 | 64.81 | 65.29 | 0.74% | 11.72% |
14 | Cisco | CSCO | NASDAQ | 6,827 | 33.75 | 33.47 | -0.83% | 10.75% |
15 | Qualcomm | QCOM | NASDAQ | 6,723 | 52.49 | 52.82 | 0.63% | -18.99% |
16 | Oracle | ORCL | NYSE | 6,702 | 48.40 | 48.61 | 0.43% | 26.42% |
17 | Honda | HMC | NYSE | 6,519 | 30.09 | 30.26 | 0.56% | 3.67% |
18 | Astra Zeneca PLC | AZN | NYSE | 6,363 | 34.26 | 34.61 | 1.02% | 26.68% |
19 | Merck & Co. | MRK | NYSE | 5,759 | 64.55 | 63.39 | -1.80% | 7.68% |
20 | Daimler | DDAIY | OTC | 5,084 | 68.70 | 67.91 | -1.15% | -3.97% |
21 | Bayer AG | BAYN | XETRA | 4,880 | 117.20 | 118.15 | 0.81% | 19.19% |
22 | Sanofi SA | SNY | NYSE | 4,755 | 50.57 | 49.49 | -2.14% | 22.38% |
23 | IBM | IBM | NYSE | 4,628 | 146.48 | 147.10 | 0.42% | -11.38% |
24 | GlaxoSmithKline | GSK | NYSE | 4,508 | 40.61 | 41.01 | 0.98% | 6.49% |
25 | Eli Lilly Co | LLY | NYSE | 4,489 | 87.08 | 86.55 | -0.61% | 17.68% |
Total | 209,080 | 3,581.51 | 3,618.42 | 1.03% | 22.33% | |||
Biopharmaceutical | 745.85 | 748.80 | 0.40% | 16.04% | ||||
Automotive | 300.39 | 302.66 | 0.76% | 7.85% | ||||
ICT | 1,545.69 | 1,564.02 | 1.19% | 19.71% |
About the R&D Market Pulse Index
R&D Market Pulse Index is a weekly stock market summary of the top international companies involved in research and development. The top 25 industrial spenders of R&D in 2017 were selected based on the latest listings from Schonfeld & Associates’ June 2017 R&D Ratios & Budgets. These 25 companies include pharmaceutical (11 companies), automotive (5), ICT (8) and conglomerate (1) organizations who invested a cumulative total of more than $209 billion in R&D in 2017, or approximately 10% of all the R&D spent in the world by government, industries and academia combined, according to R&D Magazine’s 2017 Global R&D Funding Forecast. The stock prices used in the R&D Index are tabulated from NASDAQ, NYSE, XETRA and OTC common stock prices (in U.S. dollars) for the companies selected at the close of stock trading business on the Friday preceding the publication of the R&D Index in R&D Magazine’s R&D Daily eNewsletter.
The companies used in the R&D Index include Amazon, Alphabet/Google, Microsoft, Intel, Apple, Volkswagen AG, Roche Pharma, Toyota, Johnson & Johnson, Novartis, General Motors, Pfizer, Bristol-Myers Squibb, Cisco, Qualcomm, Oracle, Honda Motor Company, Astra Zeneca plc, Merck & Company, Daimler, Bayer AG, Sanofi SA, IBM, GlaxoSmithKline and Eli Lilly Co. Stock prices are based on those stocks traded on the U.S. exchanges. R&D Index trends (in the stock prices) are just one indicator of the amount of capital available to these high-technology companies to invest in R&D and should not be implied to indicate the absolute value of R&D investments made by these organizations. The companies chosen for the R&D Index have very large sophisticated internal and global R&D organizations with each company investing between $4.5 and $17 billion annually on their R&D efforts.