Pharma finance
When the stock market takes refuge in the drugmakers
From 12 to 16 October, US inflation rattled the markets. The big laboratories rose, the small biotechs sank. The week explained without jargon.
· N° 3
On Wednesday 14 October, the United States published its September inflation figure, the rise in prices over one year: 3.7%, according to the Bureau of Labor Statistics. For the markets, it is a sign that money could cost more. That day on Wall Street, health was one of only three sectors to rise, once again.
The refuge of the big names
Why the drugmakers? They sell medicines people need, crisis or not. When worry rises, investors buy what already pays. Over the week, the global pharma index gained 3.5%, while the index of small US biotechs lost 6.1%. When money costs more, these young companies suffer first.
Jobs, the other column
Britain’s GSK shows the other side. On 14 October it announced up to 1,217 job cuts in Belgium, and its share ended the week higher. A share price never says why it rises, and it cures no one extra. For patients, nothing changed in five days. For some Belgian workers, a great deal.
Based on Bureau of Labor Statistics, Yahoo Finance and Reuters