Lilly taps obesity windfall for more M&A. Plus, Elon Musk remarks pull GE Vernova lower

An important development from the financial markets: Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. Stocks are broadly lower to start the week. Within the S & P 500's 11 sectors, energy is the clear winner Monday after the U.

and Iran exchanged strikes over the weekend. The escalation sent U. oil benchmark WTI crude back above $85 a barrel and international standard Brent crude above $90.

Economic Details

The rise in oil, along with Federal Reserve Chairman Kevin Warsh's hawkish speech Friday in Jackson Hole, is pressuring bonds, with the 10-year Treasury yield climbing to 4. The only other S & P sector in the green was technology, which creeped into positive territory in afternoon trading. Communication services is leading to the downside.

Eli Lilly made yet another biotech deal, acquiring Merida Biosciences for up to $2. Merida is working on a new class of therapeutics for serious autoimmune and allergic diseases. Unlike traditional medications that suppress the immune system, Merida is developing biologics that degrade pathogenic autoantibodies that cause immune-mediated conditions.

Merida's lead program is in early stage development for Graves' disease and thyroid eye disease, so it will be quite some time before we learn if this approach delivers differential results. Still, this acquisition fits Lilly's long-term strategy of "investing in technologies that can really change other diseases like we've changed obesity," CEO David Ricks told CNBC's Sara Eisen on Monday morning. Ricks noted that Lilly has been highly acquisitive in 2026, as the Indianapolis-based drugmaker puts its obesity windfall to work .

Analyst Views

"We've done more deals this year than we did all of last year," Ricks said. Another notable comment from Ricks was his opinion of PepsiCo dropping GLP-1 coverage for its employees, with Bloomberg News reporting last week that the decision came in response to escalating costs for the drugs. "Right now it's about neutral.

Although the press picks up on the drops, there are adds as well. It's about flat," Rick said. "I think what I'd say to PepsiCo or anybody else, you're already paying for obesity whether you cover the drugs or not.

Obesity is the biggest driver of employer health costs, through heart attacks, diabetes, other untoward consequences of obesity. So treating it is a smarter play. " GE Vernova shares are trading 2% lower after Elon Musk said on social media that SpaceX is developing in-house casting for natural gas turbine blades and vanes to accelerate production of the power-generating equipment by up to 18 months.

Economists are analysing what the news means for the markets.