Understanding the Market | Concept stocks related to CRO rise in early trading, the Fed may start cutting interest rates in September, overseas innovative drug investments are gradually picking up
Concept stocks related to CRO performed strongly in the morning session, with WuXi Biologics up 4.68% and WuXi AppTec up 4.62%. Guotai Junan Securities predicts that the Federal Reserve may cut interest rates by 25 basis points in September, with a total of 3 rate cuts expected. Powell stated that the Fed will support the labor market and monitor inflation. CRO companies are facing performance pressure during the semi-annual report disclosure period, but some companies remain optimistic about investment recovery. In the first half of 2024, global innovative drug financing events decreased by 12.5%, while the financing amount increased by 15.3%, indicating a warming trend in overseas investment
According to the Wise Finance APP, CRO concept stocks rose in the morning session. As of the time of publication, WuXi Biologics (02269) rose by 4.68% to HKD 10.74; WuXi AppTec (02359) rose by 4.62% to HKD 32.85; Tigermed (03347) rose by 3.17% to HKD 29.3; Kanglong Chemical (03759) rose by 2.48% to HKD 8.28.
Guotai Junan stated that the Federal Reserve is expected to cut rates by 25 basis points in September with a high probability, and there is a significant possibility of three rate cuts throughout the year. The current market's rate cut expectations are somewhat over-adjusted. Powell's remarks have essentially confirmed the Fed's monetary policy shift and rate cut in September. However, there is still considerable room for debate regarding the magnitude and pace of the rate cuts. Powell stated in his speech that "efforts will be made to support a strong labor market while continuing to move towards the goal of price stability," indicating that although overall dovish, inflation must still be considered. He also believes that the U.S. economy still has resilience, so the rate cut pace may not be too rapid.
Xiangcai Securities pointed out that the current period is in the midst of the semi-annual report disclosure period. Based on the disclosed annual reports, CRO companies are generally under pressure due to the decline in pharmaceutical industry investment and financing. However, some CRO companies are relatively optimistic about the improvement in pharmaceutical investment and financing. According to the annual report of Pharmaron Technology citing data from PharmaCube: In the first half of 2024, there were a total of 412 financing events in the global innovative drug field, a year-on-year decrease of 12.5%. In terms of financing amount, the global total financing amount was USD 15.161 billion, a year-on-year increase of 15.3%. Overseas innovative drug investment is gradually showing an upward trend