US Open: Wall Street attempts to rebound after PPI data 🗽Eli Lilly loses 7% amid disappointing sales forecasts

• U.S. indices recover from recent sell-offs in relative tentativeness; US100 gains 0.4%; US200 over 1%
• Tesla (TSLA.US) the strongest stock among US BigTech companies. Bitcoin rises back above $96K; Microstrategy (MSTR.US) gains over 4%
• Eli Lilly (LLY.US) loses 7% after disappointing diabetes drug sales forecasts
• Yields continue to settle at 4.8% despite a lower-than-forecast US PPI inflation release for December

Stock market tries to rebound today as US PPI report came in lower than expected, proving Wall Street a fuel to rebound ahead of tomorrow 1:30 PM GMT December CPI report. However, overall investors sentiments are still negative.

Eli Lilly stock sell-off weighs on pharmaceutical sector stocks; company presented disappointing sales forecasts for weight loss drug. The semiconductor and software sectors are gaining. Source: xStation5

US PPI data for December

• PPI: 3.3% y/y; forecast 3.5% y/y; previously 3.0% y/y;
• PPI index: 0.2% m/m; forecast 0.4% m/m; previous 0.4% m/m;
• Base PPI: 3.5% y/y; forecast 3.8% y/y; previous 3.5% y/y;
• Base PPI: 0.0% m/m; forecast 0.3% m/m; previous 0.2% m/m;
• PPI excluding food/energy/transportation: 3.3% y/y; previously 3.5% y/y;
• PPI excluding food/energy/transport: 0.1% m/m; forecast 0.3% m/m; prior 0.1% m/m
• US Redbook chain store sales: 4% YoY vs 6.8% YoY previously

(US100, D1, H4 and H1 interval)

The key for the bulls now is to cross 21400 points, where the EMA50 (orange line) runs.Source: xStation5

The US100 has returned above the 23.6 Fibonacci retracement of the August 2024 upward wave, crossing 21020 points.Source: xStation5

Supply has definitely dominated over the past few sessions, and this trend continues in today's session as well.

Source: xStation5

Eli Lilly loses after disappointing forecasts

Eli Lilly forecast revenue for calendar 2024 of $58.0 billion to $61.0 billion, against a consensus of $58.72 billion. Weight-loss and type II diabetes drugs Mounjaro and Zepbound posted solid sales growth in Q4; Eli Lilly points to 'continued trend', forecasts revenue growth from new products. All this was not enough, however, in the context of a challenging valuation. Novo Nordisk (NOVOB.DK) is also losing more than 4% on the wave of Eli Lilly's decline.

• Lilly's preliminary Q4 2024 revenues. approx. $13.5 billion, estimate. USD 14.0 billion
• Q4 revenue from Monjuaro $3.5 billion, estimate $4.4 billion
• Zepbound revenues approx. $1.9 billion, estimate $2.2 billion
• The company reported that je drug sales in the U.S. rose 45% y/y, but previous guidance had predicted an even faster acceleration of growth in the quarter.

The market for insulin-boosting drugs grew more slowly than expected, but the company still sees healthy growth in 2025 due to the success of weight-loss drugs. The company expects Q4 revenue of $13.5 billion, about $400 below the low end of the last estimated range released in October; Fact Set estimated $13.93 billion.

In the fourth quarter, the company reported strong sales of Mounjaro and Zepbound drugs, as well as oncology, immunology and neuroscience drugs. The lower sales forecast was due to slow growth in the market for so-called incretins, which increase insulin levels. However, Eli Lilly estimates that the unfavorable dynamics are temporary, and is betting on a rebound sometime in early 2025.

Source: xStation5