US stocks hit rockier waters as we moved into autumn with mixed messages on interest rates, new tariffs and geopolitical uncertainty all weighing on sentiment.
Initial excitement early in the week about the $100 billion tie-up between OpenAI and Nvidia (NVDA:NASDAQ) faded as concern built over potential antitrust issues. Though Intel (INTC:NASDAQ), which inked its own deal with Nvidia earlier this month, remained in demand.
A ropey set of earnings from used car retailer CarMax (KMX:NYSE) put its stock firmly in reverse gear and mining outfit Freeport McMoRan Copper & Gold (FCX:NYSE) slumped after a major incident at its Grasberg copper mine in Indonesia. The scale of this operation, it is the world's second largest copper mine, meant the news helped push up prices of the metal higher globally.
PFIZER
Pfizer (PFE:NYSE) announced the acquisition of biotechnology company Metsera (MTSR:NASDAQ) for up to $7 billion in cash on 22 September as the beleaguered pharmaceutical firm looks to beef-up its anti-obesity portfolio.
The acquisition would give Pfizer access to a portfolio of differentiated oral and injectable incretin, non-incretin and combination next generation obesity therapies. The news sent shares in Metsera up more than 60% to $53 while Pfizer shares were given a 3% boost to $24.Metsera has two therapies under development which promise to induce good weight loss with a monthly dose rather than the weekly injections required by existing treatments, Wegovy and Mounjaro.
Pfizer scrapped its own experimental oral obesity drug candidate danuglipron in April after a participant experienced a liver injury, which followed a decision in 2023 to discontinue a twice-daily formulation of the same drug. The global obesity drug market is projected by analysts to reach $150 billion by the early 2030s driven by the rapid adoption of GLP-1 therapies, with many companies now developing next-generation treatments.
AMAZON
Shares in e-commerce and cloud computing play Amazon (AMZN:NASDAQ) endured a difficult week.
First it announced the closure of all its 19 Fresh grocery shops in the UK (23 September). Then, in a separate development, on 25 September it emerged that it had agreed to pay $2.5 billion to resolve claims brought by the US government that it tricked millions of people into enrolling as Prime members and made it difficult to cancel.
On the groceries decision, the company said it followed ‘thorough evaluation of business operations and the very substantial growth opportunities in online delivery’. All is not lost for some of the shops, five of the Fresh locations will be converted into Whole Food shops.
Amazon first opened its first Fresh location outside the US in London in 2021 but since then the company has slowed expansion of its Fresh grocery chain.
AUTOZONE
AutoZone (AZO:NYSE) shares decelerated 2.3% to $4,120 this week after the US automotive parts and accessories specialist’s fourth-quarter earnings (23 September) missed Wall Street estimates despite strong same-store sales growth of 5.1%.
The culprit was an $80 million non-cash LIFO (last in, first out) accounting charge, which put a dent in the Tennessee-based company’s profits for the quarter ended 30 August, with earnings per share of $48.70 coming in light of the $50.90 analysts were looking for. Revenue of $6.2 billion met market expectations for a quarter in which the share buybacks machine opened 141 net new stores globally, increasing its total store count to 7,657.
‘We expect to aggressively open stores in the new year as we continue to focus on growing our market share over time,’ insisted CEO Phil Daniele. ‘As we continue to invest in our business, we expect that our disciplined approach of increasing earnings and cash flow will deliver strong shareholder value.’
