The R&D Index for the week ending May 3, 2019 closed at 4,843.13 for the 25 companies in the R&D Index. The Index was down -1.19% (or 58.10 basis points) from the week ending April 26, 2019. The stock of 16 R&D Index members gained value from 0.02% (Toyota) to 5.95% (Bristol-Myers Squibb). The stock of nine R&D Index members lost value from -0.02% (Honda) to -6.88% (Alphabet/Google).
The Department of Labor announced on Friday that the U.S. economy added 263,000 jobs in April and dropped the unemployment rate to 3.6%, the lowest level since December 1969. Both announcements were better than analysts’ forecasts. The stock market responded appropriately with the DJIA rising nearly 200 points following the announcement. The job additions were the 103rd consecutive month (8.6 years) of job gains.
The Federal Reserve held short-term interest rates steady at its regular meeting last Tuesday-Wednesday and stated that it’s unlikely to raise or lower interest rates later this year. All ten Fed members voted to keep interest rates at the current range of 2.25% to 2.50%. The next Fed meeting is scheduled for June 18-19.
Details on the Qualcomm-Apple settlement revealed that Apple will pay Qualcomm $4.5 to $4.7 billion. The settlement also commits Qualcomm to a six-year licensing deal with Apple and a multi-year agreement for Qualcomm to supply Apple with modem chips. Despite the deal, Qualcomm’s chip shipments were expected to fall 25% below those in 2018 due to slower than expected rollout of next-generation wireless technologies.
R&D Index member Apple posted its first back-to-back quarterly profit (-16%) and sales (-5%) drops last week, below analysts’ expectations. Apple stock was still up 3.6% for the week. Helping Apple last week was the Qualcomm settlement, its’ continuing stock repurchase plans and its strategic refocusing on selling software subscriptions.
R&D Index member Google’s stock fell nearly 7% for the week following its Tuesday posting of its slowest quarterly revenue growth since 2015. Google was up as much as 24% from January 1, but now is only up 14%.
U.S. worker productivity rose 3.6% in 1Q according to a report from the Labor Department last Thursday. Productivity was up 2.4% from 2018, the strongest yearly gain in nearly ten years. The trend, however, is near the historical average since the end of World War II.
| R&D Index Week Ending May 3, 2019 |
| Ticker | Exchange | 2018 R&D millions U.S. $ | 04/26/19 | 05/03/19 | 5/3/19 to 4/26/19 | 5/3/19 to 12/31/18 | ||
| 1 | Amazon | AMZN | NASDAQ | 26,750 | 1,950.63 | 1,962.46 | 0.61% | 30.66% |
| 2 | Alphabet/Google | GOOGL | NASDAQ | 18,796 | 1,277.42 | 1,189.55 | -6.88% | 13.84% |
| 3 | Apple | AAPL | NASDAQ | 14,037 | 204.30 | 211.75 | 3.65% | 34.24% |
| 4 | Intel | INTC | NASDAQ | 13,702 | 52.43 | 51.75 | -1.30% | 10.27% |
| 5 | Microsoft | MSFT | NASDAQ | 13,558 | 129.89 | 128.90 | -0.76% | 26.91% |
| 6 | Roche Pharm | RHHBY | OTC | 12,284 | 32.66 | 33.23 | 1.75% | 6.92% |
| 7 | Johnson & Johnson | JNJ | NYSE | 11,493 | 140.39 | 142.01 | 1.15% | 10.04% |
| 8 | Merck & Co. | MRK | NYSE | 11,323 | 76.63 | 80.00 | 4.40% | 4.70% |
| 9 | Volkswagen AG | VWAGY | OTC | 10,915 | 17.79 | 18.34 | 3.09% | 17.56% |
| 10 | Toyota | TM | NYSE | 10,848 | 123.62 | 123.65 | 0.02% | 6.52% |
| 11 | Novartis | NVS | NYSE | 8,934 | 81.29 | 82.61 | 1.62% | -3.73% |
| 12 | Honda | HMC | NYSE | 8,180 | 27.98 | 27.96 | -0.02% | 5.71% |
| 13 | Pfizer | PFE | NYSE | 7,942 | 39.97 | 41.39 | 3.55% | -5.18% |
| 14 | Daimler | DDAIY | OTC | 7,615 | 65.02 | 65.76 | 1.14% | 24.62% |
| 15 | General Motors | GM | NYSE | 7,278 | 39.68 | 38.80 | -2.22% | 15.99% |
| 16 | Oracle | ORCL | NYSE | 7,001 | 55.41 | 54.79 | -1.12% | 21.35% |
| 17 | Bristol-Myers Squibb | BMY | NYSE | 6,981 | 45.89 | 48.62 | 5.95% | -6.46% |
| 18 | Eli Lilly Co | LLY | NYSE | 6,769 | 119.87 | 116.91 | -2.47% | 1.03% |
| 19 | GlaxoSmithKline | GSK | NYSE | 6,394 | 40.40 | 40.75 | 0.87% | 6.65% |
| 20 | Cisco | CSCO | NASDAQ | 6,009 | 55.88 | 54.94 | -1.68% | 26.79% |
| 21 | IBM | IBM | NYSE | 5,842 | 139.44 | 140.25 | 0.58% | 23.38% |
| 22 | Bayer AG | BAYN | OTC | 5,743 | 17.39 | 17.33 | -0.34% | -1.37% |
| 23 | Astra Zeneca PLC | AZN | NYSE | 5,483 | 37.99 | 38.41 | 1.11% | 1.13% |
| 24 | Qualcomm | QCOM | NASDAQ | 5,183 | 86.64 | 89.29 | 3.06% | 56.92% |
| 25 | Sanofi SA | SNY | NYSE | 4,694 | 42.62 | 43.68 | 2.49% | 0.62% |
| Total | 243,754 | 4,901.23 | 4,843.13 | -1.19% | 20.25% | |||
| Biopharmaceutical | 675.10 | 684.94 | 1.46% | 2.10% | ||||
| Automotive | 274.09 | 274.51 | 0.15% | 12.34% | ||||
| ICT | 2,001.41 | 1,921.22 | -4.01% | 19.31% | ||||
About the R&D Index
R&D Magazine’s R&D 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 2018 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 2019 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.
