R&D Market Pulse Index for the week ending July 14, 2017 closed at 3,522.16 for the 25 companies in the R&D Index. The Index was up 2.48% (or 85.38 basis points) over the week ending July 7, 2017. Twenty-three R&D Index companies gained value last week from 0.05% (Johnson & Johnson) to 4.78% (Microsoft). Two R&D Index companies lost value last week from -0.16% (Merck & Co.) to -1.36% (Bristol-Myers Squibb).

The U.S. Dept. of Commerce reported on Friday that inflation was unchanged in June, which disappointed economists who expected overall prices to advance 0.1% and core prices to increase 0.2%. These soft inflation data result in caution by the Federal Reserve in its plan for future short-term interest rate increases. Low inflation rates lowers the purchasing power of the fixed returns on government bonds and can lead to higher bond interest rates.

Growth in China’s domestic agricultural production is expected to lag behind Chinese demand in 2017 and for the next several years, according to a report issued by the Organization for Economic Cooperation and Development (OECD). Production has actually fallen for the past three years, but was masked by withdrawals from China’s strategic reserves. Part of this trend was due to a change in China’s agricultural policy in 2014, which stated rational use of international agricultural markets and reliable trade relations. The net result is declining Chinese production of cotton, soybeans, sugar, rapeseed and now corn, according to the U.S. Dept. of Agriculture. This has also resulted in increased imports (by about 18% or more) from Brazil, the U.S. and Thailand to fill the gap.

The Organization for Economic Co-operation and Development (OECD) also issued an economic forecast last week, citing faster growth in France and China for 2017, but a slowdown in the U.S., the UK, Italy and Russia. Earlier expectations for increases in investment spending, and cuts in taxes under President Trump have failed to appear in the U.S., while a slowdown in consumer spending in the UK in response to an increase in inflation are being linked to the pound’s depreciation from the UK’s vote to leave the EU.

The newly appointed FDA commissioner Scott Gottlieb appears to be speeding up drug approval policy at the agency, according to a report last week in the Wall Street Journal. The report suggests that the FDA is developing “a much more pragmatic and practical approach to drug development, something less rigid, and a little more holistic than previous FDA practices.”

R&D Index Week Ending July 14, 2017

	Ticker	Exchange	2017 R&D billions$	07/07/17	07/14/17	7/14/17 to 7/7/17	7/14/17 to 1/1/17
Amazon	AMZN	NASDAQ	17,774	978.76	1,001.81	2.36%	33.60%
Alphabet/Google	GOOGL	NASDAQ	15,845	940.81	976.91	3.84%	23.28%
Microsoft	MSFT	NASDAQ	13,987	69.46	72.78	4.78%	17.12%
Intel	INTC	NASDAQ	13,499	33.88	34.68	2.36%	-4.38%
Apple	AAPL	NASDAQ	11,506	144.15	149.04	3.39%	28.68%
Volkswagen AG	VLKAY	OTC	11,260	32.23	33.62	4.31%	17.22%
Roche Pharm	RHHBY	OTC	10,174	31.37	31.94	1.82%	11.95%
Toyota	TM	NYSE	9,170	108.47	110.20	1.59%	-5.97%
Johnson & Johnson	JNJ	NYSE	9,060	132.54	132.60	0.05%	15.09%
Novartis	NVS	NYSE	7,870	82.32	83.16	1.02%	14.17%
General Motors	GM	NYSE	7,468	34.94	36.35	4.04%	4.33%
Pfizer	PFE	NYSE	7,288	33.35	33.43	0.24%	2.92%
Bristol-Myers Squibb	BMY	NYSE	6,942	55.91	55.15	-1.36%	-5.63%
Cisco	CSCO	NASDAQ	6,827	30.90	31.42	1.68%	3.97%
Qualcomm	QCOM	NASDAQ	6,723	55.35	56.81	2.64%	-12.87%
Oracle	ORCL	NYSE	6,702	49.35	50.56	2.45%	31.50%
Honda	HMC	NYSE	6,519	27.26	27.63	1.36%	-5.34%
Astra Zeneca PLC	AZN	NYSE	6,363	33.75	33.87	0.36%	23.98%
Merck & Co.	MRK	NYSE	5,759	63.16	63.06	-0.16%	7.12%
Daimler	DDAIY	OTC	5,084	63.48	64.87	2.19%	-8.27%
Bayer AG	BAYN	XETRA	4,880	109.95	112.75	2.55%	13.74%
Sanofi SA	SNY	NYSE	4,755	47.90	48.18	0.58%	19.14%
IBM	IBM	NYSE	4,628	152.94	154.24	0.85%	-7.08%
GlaxoSmithKline	GSK	NYSE	4,508	42.26	42.75	1.16%	11.01%
Eli Lilly Co	LLY	NYSE	4,489	82.29	84.35	2.50%	14.68%
Total			209,080	3,436.78	3,522.16	2.48%	18.10%
		Biopharmaceutical		714.80	721.24	0.90%	11.76%
		Automotive		266.38	272.67	2.36%	-2.84%
		ICT		1,476.84	1,526.44	3.36%	16.83%