What signal Lilly sends by stockpiling GLP-1 obesity pills ahead of FDA approval
Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. Stocks were rebounding to wrap up another volatile week that saw the S & P 500 still headed for losses over the past five trading days. The cooler-than-expected January consumer price index played a role in the market’s positive Friday, bringing down bond yields and boosting interest rate cut expectations for later this year. Paired with a stronger-than-expected January jobs report, this week’s data should make the market feel a little better about the direction of the economy. There’s also some bounce in sectors hit hardest by AI disruption fears, particularly software, which was the first group to sell off earlier this year on those concerns. Every S & P sector was in positive territory except communication services , which was pressured by declines in Alphabet. For the week , the three top performing sectors in the market were utilities , materials , and real estate . This was the market’s way of saying that these owners of hard assets face minimal risks of AI disruption. Both consumer staples and energy posted gains of more than 1%, too. The weakness in this week’s market was most concentrated in the financials , communication services, consumer discretionary , and technology . Eli Lilly is gearing up for its GLP-1 obesity pill launch. A filing Thursday showed the drug maker has built up $1.5 billion worth of pre-launch inventory of orforglipron. That’s up from around the $550 million of inventory that Lilly said it had last year. The Food and Drug Administration has set April 10 as its target action date to approve orforglipron, and this pre-built inventory shows Lilly is expecting strong demand out of the gate and won’t face the supply chain shortages the GLP-1 market experienced in 2022 through 2024. If the strong uptake of Novo Nordisk ‘s weight-loss Wegovy pill is a guide, these new medications will expand the category with new starts and won’t notably cannibalize the injectable market. Roughly 50 companies in the S & P 500 are scheduled to report earnings in the upcoming holiday shortened week. In the portfolio, we’ll get Palo Alto Networks on Tuesday evening and Texas Roadhouse on Thursday evening. A few other important earning reports to watch are Walmart, DoorDash, Toll Brothers, and Deere. On the data side, the week head brings durable goods orders, housing starts, industrial production, the December PCE price index, fourth quarter GDP, new home sales, and University of Michigan consumer sentiment and inflation expectations. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
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