Danish drugmaker Novo Nordisk A/S (CPH: NOVO-B) lost more than 10% last week after its US rival Eli Lilly & Co (NYSE: LLY) reported encouraging Phase 3 data for its oral weight-loss treatment. 

Lilly’s orforglipron demonstrated “statistically significant efficacy results and a safety profile consistent with injectable GLP-1 medicines” in the late-stage clinical trial. 

Investors bailed on Novo Nordisk shares in response as Lilly’s update stretches its lead in the anti-obesity market that many believe could be worth $100 billion over the next few years. 

NVO is now down nearly 35% versus its year-to-date high in early March. 

Novo Nordisk stock may be fairly valued at $64

Eli Lilly’s orforglipron news also made BMO analysts downgrade NVO stock to “market perform” last week. 

The investment firm slashed its price target on Novo Nordisk shares from $105 to $64 only that no longer translates to a meaningful upside from current levels. 

According to BMO analysts, “key updates from Lilly’s oral GLP-1 are likely to pressure shares, only to be compounded by what we believe to be a softer 1Q.” 

Note that Eli Lilly stock has already outperformed Novo Nordisk by a mile over the past 12 months. LLY is currently down just 13% versus its 52-week high while NVO has lost more than 70% since July of 2024. 

NVO topped Street estimates in its fiscal Q4

BMO turned more dovish on the Danish drugmaker last week as “obesity competitor Lilly has made sizable advancements in its commercial and clinical portfolio, causing it to overtake Novo’s early lead.”

NVO shares have failed to impress in recent months even though its net profit came in well above expectations in its latest reported quarter. 

In February, the pharmaceutical giant said its net profit increased by 29% on a year-over-year basis to $3.98 billion in Q4. 

Concerns that it’s losing to Eli Lilly & Co in the weight-loss market have kept investors on the sidelines despite a healthy dividend yield of 2.86% that’s tied to Novo Nordisk at writing. 

Should you invest in NVO shares today?

Lilly’s orforglipron news is significant for Novo Nordisk as its weight-loss drug, Wegovy, has been generating much of the strength in its financials. 

In its fiscal fourth quarter, the European behemoth saw its Wegovy sales more than double to $2.76 billion.

Analysts, however, had called for north of $3.0 billion instead. 

At the time, Lars Fruergaard Jørgensen, the chief executive of NVO said in a CNBC interview that “we can compete in the US market with tablet-based treatment before Lilly can launch. 

Investors should also note that BMO has a bit of a contrarian view on the pharma stock.

The consensus rating on NVO still sits at “overweight” with the mean target of $108 indicating potential upside of some 80% from current levels. 

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Swiss pharmaceutical giant Roche unveiled ambitious plans on Tuesday for a substantial $50 billion investment in the United States over the coming five years.

This significant commitment represents one of the largest recent inward investment declarations by a multinational corporation navigating the complexities of current US trade policies, including tariffs implemented under the Trump administration.

The comprehensive investment strategy is set to generate considerable employment opportunities across the country.

Roche detailed that the $50 billion infusion would lead to the creation of more than 12,000 new jobs.

This figure includes nearly 6,500 positions related to construction activities and an additional 1,000 permanent roles at newly established and expanded company facilities.

Strategic investment in a shifting trade environment

Roche’s announcement comes at a time when various global manufacturers, particularly within the pharmaceutical sector, are reassessing their supply chains and investment footprints in response to the Trump administration’s focus on tariffs and boosting domestic production.

This move mirrors a similar declaration earlier this month by fellow Swiss drugmaker Novartis, which committed to spending $23 billion on expanding and building new facilities within the United States.

Expanding US footprint: R&D and manufacturing focus

The scope of Roche’s investment is extensive, targeting key areas of its operations.

The company specified that the funds will support the development of new research and development (R&D) sites.

Furthermore, significant capital will be allocated to expanding existing manufacturing capabilities in several states, including Indiana, Pennsylvania, Massachusetts, and California.

This broad geographic spread underscores a deep commitment to enhancing Roche’s operational base within the US.

Aiming for net export status from the US

A key strategic outcome articulated by Roche is a fundamental shift in its US trade balance.

The company stated that once the new and expanded manufacturing capacities become fully operational, it anticipates exporting more medicines from the United States than it imports.

This signals a long-term vision for the US serving as a major global supply hub for the company’s products.

Underscoring the significance of the plan, Roche Chief Executive Thomas Schinecker emphasized the company’s dedication to the American market.

“Our investments of $50 billion over the next five years will lay the foundation for our next era of innovation and growth, benefiting patients in the US and around the world,” Schinecker said in a statement, framing the investment as crucial for future advancements and patient access globally.

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Shares of metal companies rose up to 2% on Monday, tracking gains in broader markets, after the Indian government imposed a 12% safeguard duty on certain steel imports.

The decision, aimed at curbing the influx of cheaper steel from countries like China, came into effect immediately and will remain in force for 200 days unless revoked, superseded or amended earlier.

The Nifty Metal index climbed 1% on the day, with prominent players JSW Steel rising 1.8%, and Tata Steel and Steel Authority of India Limited (SAIL) advancing around 2% each.

The overall market sentiment remained upbeat, as both benchmark indices Sensex and Nifty recorded modest gains in response to the policy intervention.

Move targets surge in Chinese steel shipments

India, currently the world’s second-largest producer of crude steel, has seen a sharp rise in imports of cheaper steel products, largely from China.

The latest safeguard duty is widely perceived as a strategic move to protect the domestic steel industry from injury caused by this influx.

In the fiscal year 2024–25, India was a net importer of finished steel for the second consecutive year, with imports touching a nine-year high of 9.5 million metric tons, according to provisional government data.

“The safeguard duty will help restore a level playing field in the market,” said Steel Minister H. D. Kumaraswamy.

“This move will provide critical relief to domestic producers, especially small and medium-scale enterprises, who have faced immense pressure from rising imports.”

The Ministry of Finance stated in its official order that the safeguard duty aims to prevent further damage to local manufacturing units, many of which have been compelled to cut back on production or consider job cuts due to the pricing pressure from imports.

First major trade policy step post-Trump-era tariffs

This is the Indian government’s first major trade policy shift since the United States, under then-President Donald Trump, triggered a wave of global protectionism by imposing broad-based tariffs on various imports, including steel.

Though India’s concerns about Chinese steel imports predate those events, the current safeguard duty follows a formal investigation that began in December 2024.

Industry experts suggest that New Delhi’s action aligns with measures considered or implemented by other countries facing similar trade pressures. “The world is impacted by Chinese imports, whether directly or indirectly,” said a senior executive at a leading Indian steelmaker in a Reuters report.

“We hope this duty helps support the industry’s margins and discourages under-priced steel shipments.”

Analysts see margin boost from Q1FY26

Brokerages were quick to react to the development.

ICICI Direct Research called the duty a “positive development” for domestic steelmakers and noted that the recovery in steel prices is likely to support margin expansion beginning in the first quarter of FY26.

YES Securities said Indian metal companies would be navigating a somewhat mixed landscape in Q4 FY25 as Trump tariffs are expected to overshadow the companies’ operational performances.

“Steel producers are benefiting from a seasonal demand uptick, a 12% safeguard duty, and the ease in coking coal prices, which should support an improvement in EBITDA/tone,” it said in a report.

Industry associations, including the Indian Steel Association—which counts JSW Steel, Tata Steel, SAIL, and ArcelorMittal Nippon Steel India among its members—have repeatedly flagged concerns about the surge in low-cost imports and lobbied for government action.

Monday’s announcement, therefore, marks a significant policy win for the domestic industry, as it prepares to navigate a complex global trade environment in the quarters ahead.

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European financial markets returned from the extended Easter weekend to a climate of apprehension on Tuesday, opening lower as simmering worries about global trade tensions and US economic policy uncertainty cast a shadow over investor sentiment.

The pan-European Stoxx 600 index reflected the cautious mood, shedding 0.5% by 8:27 a.m. London time.

The pullback was broad, affecting most sectors and all major regional stock exchanges.

Technology stocks felt the pressure most acutely, with the Stoxx Europe Technology index declining 1.7% in early trading, leading the regional losses.

Simmering trade tensions and Fed independence fears

Underpinning the negative start were persistent anxieties about the potential escalation of a global trade conflict.

Adding to the unease were threats from Beijing on Monday indicating potential retaliation against countries aligning with Washington’s calls to isolate China economically.

This geopolitical friction compounded concerns stemming from the US domestic front.

The European session followed a sharp sell-off on Wall Street Monday, which was largely attributed to President Donald Trump intensifying his public pressure campaign against Federal Reserve Chair Jerome Powell.

Trump, via posts on his Truth Social platform Monday, reiterated his view that the economy would falter without Fed interest rate cuts. In his latest salvo targeting Powell by name, he branded the Fed chief “Mr. Too Late” and a “major loser.”

This rhetoric follows earlier hints from Trump about Powell’s potential “termination” – an action without precedent.

Last week, White House economic advisor Kevin Hassett confirmed that the president’s team was actively studying the legality of such a move.

Powell, for his part, has maintained that he cannot be legally fired for policy disagreements and intends to complete his term ending in May 2026.

The standoff raises fundamental questions about the central bank’s independence, a cornerstone of market stability.

Global cues and upcoming focus

The cautious sentiment rippled across the globe, with Asia-Pacific markets trading subdued overnight, taking their lead from Wall Street’s decline.

Tuesday’s European calendar lacked major corporate earnings or significant economic data releases.

However, market participants are closely monitoring developments and commentary emerging from the IMF-World Bank Spring meetings currently underway in Washington.

Discussions at these high-level gatherings are expected to be heavily focused on the threats posed by, and the economic fallout from, President Trump’s global tariff regime.

Currency dynamics: dollar weakness persists

In the currency markets, the US dollar’s recent weakness continued to be a dominant theme, providing a lift to European currencies. By 7:08 a.m. London time, the euro had gained approximately 0.2% against the dollar, trading at $1.154.

The British pound saw an almost 0.3% rise against the greenback to $1.341, and the Swiss franc also edged 0.1% higher.

The dollar’s largely downward trajectory has been evident since the market volatility sparked by Trump’s “liberation day” tariff announcements earlier in the month, even though a 90-day pause was subsequently granted for most impacted countries.

This flight from the dollar and US Treasuries reflects deep uncertainty about American policymaking, with the dollar index having weakened by over 9% so far this year.

Market watchers anticipate further declines, a view echoed strongly by institutional investors.

According to Bank of America’s latest Global Fund Manager Survey, a net 61% of respondents expect the dollar’s value to fall over the next 12 months – marking the most pessimistic outlook among major investors in nearly two decades.

This currency shift presents both challenges and opportunities for global central banks navigating the current complex environment.

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President Donald Trump’s sustained public criticism of Federal Reserve Chair Jerome Powell, stemming from the central bank’s current stance against further interest rate cuts, has sent ripples of unease through financial markets.

The escalating rhetoric has fueled investor fears that the President might take the unprecedented step of attempting to remove the Fed chief, raising profound questions about legality, precedent, and the independence of the US central bank.

The core question: can Trump fire the Fed chair?

The legal authority for such a move remains notably ambiguous.

The foundational Federal Reserve Act of 1913 clearly states that members of the Fed’s Board of Governors – who are appointed by the president and confirmed by the Senate for lengthy, staggered 14-year terms – can only be removed “for cause.”

Historically, this has been interpreted to mean proven misconduct or dereliction of duty, not disagreements over monetary policy decisions.

However, a critical point of legal uncertainty arises because the text of the Act, while specifying the “for cause” removal standard for Governors, omits this specific limitation when describing the separate, four-year term of the Fed Chair, who is designated from among the seven Governors.

This omission leaves the door open to interpretation regarding the President’s power over the Chair position specifically.

Uncharted legal and political territory

Complicating matters further is the complete lack of direct legal precedent. No US president has ever attempted to fire a Federal Reserve Chair.

While there are unrelated lawsuits concerning other Trump administration firings currently navigating the courts – including one pending before the Supreme Court – their applicability to the unique structure and independence of the Fed is debatable.

Any attempt to remove Powell would almost certainly trigger a major legal battle culminating at the nation’s highest court.

Jerome Powell’s triple role: unpacking the complexity

Understanding the practical implications requires recognizing that Powell, like his predecessors, holds three distinct but intertwined roles: he is Chair of the Federal Reserve System, a member of the Board of Governors, and Chair of the powerful, rate-setting Federal Open Market Committee (FOMC).

How Trump might target these roles significantly impacts the potential outcome.

Removing Powell only as Fed Chair: If Trump attempted to strip Powell solely of the “Chair” title, legal interpretations suggest Powell could potentially remain on the Board of Governors until his gubernatorial term expires in January 2028.

With the next scheduled board vacancy not occurring until January 2026, Trump’s immediate option would likely be limited to nominating another incumbent Governor to serve as Chair.

Notably, two current Governors, Christopher Waller and Michelle Bowman (whom Trump recently nominated for a key oversight role), were appointed by Trump during his first term.

However, both have publicly emphasized the importance of Fed independence, making it uncertain whether they would immediately pivot to the rapid rate cuts Trump desires.

Targeting the FOMC leadership: The President has no direct authority over who chairs the FOMC.

This decision rests solely with the committee’s 12 voting members (the seven Governors, the New York Fed President, and four rotating regional bank presidents).

While tradition dictates the FOMC selects the Fed Chair as its leader, they could theoretically choose any member, including Powell himself if he remained a Governor.

Ousting Powell as a governor: This scenario carries the most significant ramifications. If Trump sought to remove Powell from the Board of Governors entirely – and if such a move withstood legal challenges – it would create immediate vacancies for both a Governor and the Chair position.

This would grant Trump the opportunity to nominate individuals potentially more aligned with his views.

Critically, it could also set a precedent, potentially allowing Trump to dismiss other Governors and reshape the Fed’s leadership to be more compliant with presidential wishes, fundamentally challenging the institution’s independence.

A fight in court?

Should Trump attempt a removal, Powell would possess the legal standing to challenge the action in federal court.

As a lawyer and former private equity executive, he possesses the personal financial resources necessary to fund such a significant legal undertaking.

Powell himself has consistently stated his belief that the law does not permit his removal for policy disagreements and has expressed skepticism that the ongoing court cases involving other agency firings directly apply to the Fed’s unique statutory framework.

Speculation vs. reality: will Trump act?

Despite the heated rhetoric, whether Trump will actually attempt such a move remains uncertain.

The Wall Street Journal reported last week that Trump had discussed the possibility of firing Powell and potentially replacing him with Kevin Warsh, a former Fed governor (2006-2011).

However, the report indicated Warsh advised against this course, suggesting Powell be allowed to complete his current term as Chair, which ends in May 2026.

Adding to the intrigue, White House economic adviser Kevin Hassett – himself sometimes mentioned as a potential Powell replacement – confirmed last week that the legality and implications of removing the Fed Chair were under active study within the administration.

This ongoing study, coupled with the President’s public pressure campaign, ensures that the question of Powell’s tenure and the Fed’s independence will remain a focal point of market anxiety and political debate.

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