(KRON) — In today’s installment of Winners & Losers, financial expert Rob Black discusses a mixed stock market, Pepsi shrinking product sizes and Amazon’s quiet development of cancer vaccines.
Winner: Stocks are mixed but watching inflation & earnings
The stock market was trying to shake off a stronger dollar.
Europe is looking at tougher economic conditions as natural gas shortages are imminent.
That’s not only a sign that investors are seeking the safety of the dollar, but it also threatens to dent U.S. companies’ earnings.
That’s because sales made overseas translate into fewer dollars when the dollar strengthens.
JPMorgan and Morgan Stanley kick off second-quarter bank earnings on Thursday. Weak mortgage lending numbers and the dearth of capital-markets activity will be scrutinized as rising rates and market volatility tame the appetite to transact.
Peloton is going to outsource the manufacturing of their exercise bikes.
Hawaii is the first state to enact an $18 minimum wage, but if labor shortages continue, other states may follow suit and raise their minimums — possibly sooner than 2028. Higher minimum wages will most certainly impact retailers’ already-shrinking bottom lines.
Winner: Pepsi grows as it hikes prices and shrinks sizes
PepsiCo raised its revenue outlook for the year as inflation pushed up prices and people paid more for its Doritos chips and Gatorade drinks.
The global food and drink giant said it plans to keep shrinking product sizes and deploying other ways to manage rising expenses.
Sometimes Pepsi is using smaller sizes and reducing the number of chips in a bag rather than hiking prices.
Pepsi saw a $1.17 billion hit due to the Russia-Ukraine war.
Frito-Lay North America’s organic revenue rose 14% as sales of Cheetos and Doritos grew. But volume declined 2%.
The company’s North American beverage unit saw organic revenue growth of 9%, but its volume fell 1%. Gatorade, Aquafina and Lifewtr saw double-digit growth in the quarter.
Pepsi’s North American business will be resilient and most of its international markets will be strong despite macroeconomic and geopolitical volatility.
Winner: Amazon is quietly developing cancer vaccines
Amazon and Fred Hutchinson Cancer Centers are developing cancer vaccines, and the initiative is currently recruiting patients to participate in an FDA-approved clinical trial.
The clinical test aims to develop personalized vaccines for treatment of breast cancer and a form of skin cancer called melanoma.
If successful, the new vaccine would offer a precise cancer treatment at a more affordable price, potentially becoming a better alternative to chemotherapy, which takes a more generalized, one-size-fits-all approach.
Amazon is contributing scientific and machine learning expertise to the partnership.
Amazon has a growing interest in the healthcare sector and it has launched an online pharmacy service, a new primary care business and an in-house diagnostics lab, as well as a health-tracking device called Halo in recent years.
The cancer vaccine project came out of Amazon’s secretive moonshot lab called Grand Challenge.
Other biotech companies are developing similar technologies. Germany’s BioNTech also just recently launched similar efforts.