Before the bell: Ageas secures returns for its shareholders

Novo Nordisk cuts prices, Meta diversifies through AMD.

Yesterday an average European stock, measured by the Euro Stoxx 50, moved sideways. Ferrari provided some color with a gain of 4.2%. The Bel20 rose 0.4%. Umicore (+8%) quickly recovered from its recent slump. Solvay (+3.8%), Lotus Bakeries (+2.9%) and Melexis (+2.8%) also performed well, while KBC Group (-3.6%) took a hit after fears of AI disruption spread to the banking sector. That concern may already be fading, as JPMorgan Chase & Co (-0.1%) stabilized yesterday after Monday’s drop. On Wall Street, the selling pressure in software stocks even turned into a recovery. Adobe gained 3.4% and Thomson Reuters surged 11.4%. Payment company PayPal climbed another 6.7% after Bloomberg identified Stripe as a potential acquirer.

In Asia this morning, Tokyo is once again leading the way. The Topix gains 1% and the Nikkei 2%. Chinese indices are rising between 0.5 and 1%. In Brussels, Ageas once again delivers on its promises with strong results, including a 9% increase in premium income and a profit of 1.65 billion euro (+33%). That is better than the target CEO De Cuyper had previously indicated. The dividend is increased by 7%, bringing the dividend yield to just under 6%. At Deceuninck, revenue and EBITDA fell 7% and management does not yet see a recovery, except in Turkey. CFE also reports results. In neighboring countries Bayer, Wolters Kluwer, Diageo and HSBC open their books. In the United States investors are looking ahead to the long-awaited results from Nvidia, The Trade Desk and Salesforce, which recovered 4% yesterday.

AMD and Meta join forces

Circular transactions between companies are deals in which, for example, one company is allowed to supply products to another on the condition that the customer can purchase shares in its supplier at a favorable price. According to some observers, such arrangements are risky and help fuel the artificial intelligence bubble. AMD (+8.7%) is currently drawing from that circular playbook together with Meta (+0.3%). The two companies reached an agreement under which Meta will order billions of dollars’ worth of customized chips from AMD. In return, the transaction could eventually allow Meta to acquire a stake in AMD. Meta already signed a major deal with competitor Nvidia a week ago but appears to be diversifying its supply chain. Investors are eagerly awaiting Nvidia’s results tonight, which should provide a clearer picture of global demand for AI chips.

Novo Nordisk cuts prices

Competition between the two largest specialists in weight-loss treatments, the American Eli Lilly and Denmark’s Novo Nordisk, is becoming more intense by the day. After test results earlier this week showed that Eli Lilly’s newest weight-loss drug leads to slightly greater weight reduction than Novo Nordisk’s product, investors sent Novo Nordisk shares nearly 20% lower. From its peak, the stock has already lost more than three quarters of its value. Management believes that attack is the best form of defense. Starting in January 2027, Novo Nordisk will halve the price of its weight-loss drug Wegovy. The price of diabetes drug Ozempic will be reduced by 35%. If you cannot be the best, then be the cheapest. Patients would then pay around 675 dollar per month for Wegovy, compared with more than 1,000 dollar today for Eli Lilly’s weight-loss drug Zepbound. Margins will be going on a diet as well.

Did you know…

that several car manufacturers have halted operations in the Mexican region of Guadalajara? Japanese automaker Honda did so after members of the Jalisco New Generation Cartel made the entire area around the factories unsafe following the murder of their leader “El Mencho.”

This article was translated from Dutch and was originally published on Spaarvarkens.be.