Denmark's Novo Nordisk Rebounds Pre-Market On UBS Upgrade, But Trump's Tariff Threats Over Greenland Leaves Retail Uneasy

Novo Nordisk shares climbed over 3% in Wednesday's pre-market trading as U.S. stock futures rebounded from a tech-driven selloff. 

The Danish pharmaceutical giant benefited from a UBS upgrade to 'Buy' from 'Neutral,' with a revised price target of DKK 750, down from DKK 1,100. 

UBS highlighted the company's continued strong position in the GLP-1 medication market despite recent underwhelming Phase 3 data on its experimental obesity drug, CagriSema, according to The Fly.

UBS described the recent selloff in Novo shares as "overdone" and sees the current price levels as an attractive entry point. 

Despite the disappointing obesity trial data, the firm believes CagriSema could still differentiate itself in treating type 2 diabetes.

On Stocktwits, retail sentiment for Novo Nordisk turned ‘bearish’ before the market opened, reflecting investor apprehension. 

NVO sentiment and message volume Jan 8 premarket as of 7:20 am ET | source: Stocktwits

Geopolitical developments appeared to have contributed to this cautious mood: President-elect Donald Trump has issued a controversial threat to impose "very high" tariffs on Denmark if it refuses to relinquish sovereignty over Greenland.

Some retail watchers pointed out that Novo manufactures products sold in the U.S. domestically, but skeptics think Trump's recent statements might spook investors for some time.

Barron's reported that a Cornell University trade policy professor believes that Trump's rhetoric could lead to tariffs tailored specifically to Danish companies, regardless of where their goods are made. 

This potential geopolitical hurdle looms large for Novo, which reportedly derives 60% of its revenue from the U.S. market, including sales of popular drugs like Wegovy and Ozempic.

Novo Nordisk's stock is down more than 20% over the past year, partly due to the disappointing CagriSema trial.  

Now, geopolitical concerns seemingly threaten to complicate the stock’s recovery.

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