Wall Street got off to a good start on Monday, shaking off weakness toward the end of the previous week as investors continued to weigh the prospects for strong economic conditions in the U.S. against the slumping global economy. As of 11 a.m. EST today, the Dow Jones Industrial Average (DJINDICES:^DJI) was up 95 points to 29,197. The S&P 500 (SNPINDEX:^GSPC) rose 12 points to 3,339, and the Nasdaq Composite (NASDAQINDEX:^IXIC) picked up 50 points to 9,571.
Worries about the novel coronavirus remained for market participants. And for Chinese electric vehicle maker NIO (NYSE:NIO), the outbreak showed up clearly in financial results. Meanwhile, Eli Lilly (NYSE:LLY) had to deal with disappointment in a much-followed clinical trial seeking an elusive treatment for Alzheimer's disease.
NIO hits the brakes
Shares of NIO dropped 3% after the maker of electric SUVs for the Chinese auto market reported its latest operating results. Despite all the talk about electric vehicles following the stunning run-up in shares of Tesla (NASDAQ:TSLA), NIO has seen a lot of turbulence in its share price in recent months.
NIO's delivery numbers for January weren't as good as many had hoped to see. The company delivered a total of just under 1,600 vehicles for the month, mostly its ES6 model. That brought total cumulative deliveries to more than 33,500 vehicles, but the monthly production figure was down by more than 11% from year-ago totals.
Two factors played a role in NIO's shortfall. First, Chinese New Year was earlier in 2020 than it was in 2019, which reduced the number of available business days in January for potential customers to purchase vehicles. In addition, what the company called an "extended holiday" due to the outbreak of the coronavirus also hurt sales, as some NIO investors anticipated.
The company is still trying to keep operating even as the outbreak has forced closures of many key facilities, by focusing on online sales channels and live-streaming platforms. Nevertheless, February is likely to see reductions in both production and deliveries, and it could take a long time for NIO to recover from the current slump.
Lilly deals with disappointment
Eli Lilly's stock dropped 2% in the wake of unfortunate news for a promising treatment in the pharmaceutical company's pipeline. With many companies searching for better options for Alzheimer's patients, news that a trial didn't go as well as expected was a blow for Lilly's pipeline.
The company said that a study of its solanezumab treatment in patients with dominantly inherited Alzheimer's disease failed to reach its primary endpoint, which incorporated an evaluation of cognitive ability in areas including logical memory recall, digit symbol substitution, and a test using shopping lists to measure memory. Lilly was still looking at whether solanezumab met secondary endpoints, but the pharma company was already convinced that it wouldn't go forward with further plans to submit the treatment for approval.
That's not the end of the road for solanezumab, though. Lilly was quick to note that ongoing work in evaluating the drug as part of its study of anti-amyloid treatment in asymptomatic Alzheimer's was unaffected by the trial result here.
Nevertheless, Lilly shareholders would obviously have preferred to see better results. It's likely that the company will continue its acquisitive ways in hopes of bulking up its pipeline, and Alzheimer's patients hope that target companies might be able to add to Lilly's efforts to try to beat back the disease once and for all.