Novo Nordisk and Eli Lilly stocks fared better than tech stocks amid a massive global sell off on Monday
Concerns about an economic downturn triggered a massive global sell-off on Monday, leading to steep declines in stock indexes worldwide and major tech stocks. However, the stocks of pharma companies that produce popular weight loss drugs like Wegovy and Zepbound managed to withstand the market turmoil better.
The bloodbath in the stock market was set off by several factors, including renewed concerns about a potential recession in the U.S. due to rising unemployment rates.
Moreover, the Bank of Japan’s decision to raise its benchmark interest rate has caused the value of the yen to rise, and Japanese stocks have suffered their biggest fall since 1987. The country’s Nikkei stock index dropped by over 12% on Monday. Meanwhile, the European stocks on the Stoxx 600 index also dropped nearly 3.5%.
In the United States, the Dow Jones Industrial Average dropped 908 points, or 2.2%, to 38,828. The tech-heavy Nasdaq $NDAQ shed over 445 points or 2.6%, while the S&P 500 lost 124 points or 2.3%.
Major tech stocks were the biggest hit on Monday. Nvidia $NVDA shares fell nearly 13% during pre-market trading, and have since remained down about 7%. Apple $AAPL stock tumbled down over 6%.
Weight loss drugs stocks, however, fared better during Monday’s sell off.
Eli Lilly $LLY, the maker of the diabetes and weight loss drugs Mounjaro and Zepbound were down about 3.5%. This comes as the U.S. Food and Drug Administration signaled on Friday that an ongoing shortage of the popular drugs could be over soon.
Eli Lilly also said last week that the drug behind Zepbound was found to help cut heart failure risks in patients with obesity in a late-stage clinical trial, which could pave the way for more patients to get access to the drug.
Novo Nordisk, the company behind Ozempic and Wegovy, fell about 1% on Monday.
- Vinamrata Chaturvedi and Laura Bratton contributed to this story.
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