The R&D World Index (RDWI) for the week ending June 14, 2024, closed at 3,771.30 for the 25 companies in the RDWI. The Index was up 1.72% (or 63.98 basis points).

Nine RDWI members gained value last week from 0.37% (Novartis) to 9.70% (Oracle). Sixteen RDWI members lost value the previous week from -0.35% (Cisco) to -10.24% (Volkswagen AG).

AI news

A report released last week by the White House Office of Science and Technology Policy (OSTP) warned that support for federal R&D organizations remains challenging for promoting the government’s AI goals. The report states that the government’s aging national laboratories and infrastructure could threaten U.S. goals on emerging technologies. The report states that weak R&D infrastructures stand in the way of allowing government agencies to allocate R&D funds in advance or excess to the allotment process. The aspirations of AI allocations for novel medicines, improved electrical grid technologies, and weather forecasting cannot be accomplished by industry alone — many require deep research that’s well beyond the reach of corporate product development, according to the report. Some AI models require training on data from multiple companies with all focusing on delivering a public mission rather than a market opportunity. The White House has bolstered its AI vision applications with the introduction of a new AI.gov section focused on AI aspirations.

RDW Index member Microsoft, Redmond, Washington, continues to build its AI investments with increased AI talent hiring, global partners, and support for AI startups. Microsoft’s CEO Satya Nadella has leapfrogged competitors in AI and wants to dominate the field, according to a report last week in the Wall Street Journal. New Microsoft employees are training their AI models with the support of startup Inflection AI to compete against the OpenAI technologies that Microsoft currently relies on. Nodella is recognized as identifying company strengths that have become vulnerabilities. Microsoft has notably leaped ahead of Google to release chatbots and workplace tools expected to change how people think and work.

Olympus signs agreement

Last week, Olympus Corporation, Tokyo, announced that it would establish an R&D Offshore Development Center in Hyderabad, India, after signing an agreement with HCL Tech to expand its global activities. India’s Consul General, Jayesh Ranjan stated that India would provide its full support to contribute to India’s vision of becoming a global hub for medical device innovation and manufacturing. Olympus has R&D centers in the U.S., Japan, and Europe. The company will collaborate with AIG Hospitals Hyderabad on joint research projects.

Stallantis moves EV production

RDW Index member Stellantis, Hoofddorp, Netherlands, announced last week that it will move some production of electric vehicles (EVs) from China due to the upcoming European Union tariffs on Chinese-made EVs. The company has created cost thresholds that now dictate production locations. The Chinese production locations will be moved to European locations. The increased duties, if imposed by July 6, 2024, would amount to as high as 38% Stellantis also announced last week that it would shift the focus of its capital allocations strategy to efficient investments and shareholder returns and target a higher stock dividend in 2025.

Amazon builds data centers in Taiwan

Amazon.com, Seattle, announced last week that it will invest up to $25 billion in Taiwan over the next 15 years to build new data centers to meet the region’s growing demand for cloud services. The company stated that it will launch an Amazon Web Services (AWS) infrastructure region in Taiwan by early 2025 as part of its long-term commitment.

RDW Index member Apple, Cupertino, California, announced last week that it plans to bring a more personalized version of AI to its 2.2 billion device users, including striking a deal with ChatGPT maker OpenAI, San Francisco. The new AI system will include a voice assistant with enough personal user information to meaningfully help complete several tasks, including answering complex queries or composing messages, capabilities that current Apple apps cannot handle. Elon Musk stated that if Apple integrates OpenAI at the operating system level, he plans to ban Apple devices at his companies.

World Forest maps chemical fingerprints of trees

Researchers led by the Washington, D.C.-based nonprofit World Forest ID are working on keeping sanctioned Russian timber out of Europe by mapping the unique chemical fingerprints of trees. This process could be used to vet corporate supply chains for other banned commodities. World Forest set its sights on sanctions the EU placed on Russian and Belarusian timber following the invasion of Ukraine. The researchers analyzed thousands of world samples of trees, then layered in advanced statistical models and AI. The result was a database that allows customs officials and corporate auditors to verify the origin of the timber with a simple lab-based test.

Feds in no hurry to lower interest rates

Last week, the U.S. Federal Reserve penciled in just one interest rate cut for 2024, indicating that most officials are in no hurry to lower rates, even after a widely observed report revealed continued inflationary improvements. The central bank also held its benchmark rate of 5.25/5.50% steady last week. Most fed officials expect to see lower rates later this year with four more meetings planned at which time they could make changes.

 

R&D World’s R&D Index is a weekly stock market summary of the top international companies involved in R&D. The top 25 industrial R&D spenders in 2020 were selected based on the latest listings from Schonfeld & Associates’ June 2020 R&D Ratios & Budgets. These 25 companies include pharmaceutical (10 companies), automotive (6 companies), and ICT (9 companies) which invested a cumulative total of nearly 260 billion dollars in R&D in 2019, or approximately 10% of all the R&D spending in the world by government, industries, and academia combined, according to R&D World’s 2021 Global R&D Funding Forecast. The stock prices used in the R&D World Index are tabulated from NASDAQ, NYSE, and OTC common stock prices for the companies selected at the close of stock trading business on the Friday preceding the online publication of the R&D World Index.