Daily Newsletter | October 5, 2023

October 5, 2023

TLDR

MARKET RECAP → Stocks ticked lower Thursday as investors prepare for the key jobs data on Friday that could determine the next move for interest rates (and stocks).

WEIGHTY CONCERNS→ ? Popular weight loss drugs Wegovy and Ozempic, hailed for their impactful results, now face a hefty dilemma as a study links them to stomach paralysis and other severe gastric issues, potentially unsettling their soaring U.S. market presence.

RIVIAN ROLLERCOASTER → Rivian’s (RIVN) shares nosedived 20% after announcing a $1.5 billion convertible note offering, despite posting an in-line preliminary Q3 revenue estimate, sparking market speculation about the electric vehicle (“EV”) giant’s financial trajectory and stability amidst its ambitious projects.

Sean Horgan

Head of Investor Relations @ MoneyLion

$shorgan

Today’s S&P 500 Heatmap

Source: finviz.com

Today’s Top News

WEIGHTY CONCERNS

? A new epidemiological study, published in JAMA, raised concerns about popular weight loss and diabetes drugs, Wegovy and Ozempic, linking them to an increased risk of severe stomach conditions, notably stomach paralysis, in non-diabetic patients.

? These drugs, known as GLP-1s and produced by Novo Nordisk, have surged in popularity in the U.S. due to their significant impact on weight loss over time, but have also been under scrutiny due to reports of stomach paralysis and suicidal ideation from some patients.

? Researchers from the University of British Columbia highlighted that the conditions include stomach paralysis, which can halt the movement of food from the stomach to the intestine, and also noted an increased risk of bowel obstruction and pancreatitis.

Source: shutterstock

RIVIAN ROLLERCOASTER

? Rivian Automotive’s (RIVN) shares took a 20% dive as the company announced an unexpected plan to offer $1.5 billion in convertible notes, surprising investors and shaking the stock. The electric vehicle maker’s shares plummeted in early trading, following the disclosure of its intention to introduce “green” convertible notes due in 2030.

? Despite a preliminary third-quarter revenue estimate aligning with Wall Street’s predictions (between $1.29 billion and $1.33 billion), Rivian’s announcement to raise additional funds through note offerings raised eyebrows, especially considering its cash and equivalents dropped to $9.1 billion at the end of September from $10.2 billion in the second quarter.

? Earlier efforts to stabilize its financials included a 6% staff reduction, a $1.3 billion sale of convertible notes, and delaying the launch of its R2 vehicle platform to 2026. The latest financial maneuver, however, has left investors and market watchers pondering Rivian’s strategic financial stability and future moves in the competitive EV market.