Happy Cana(bis)da Day.

I was quoted on a US stock today in Wallstreetsbestinvestments' monthly issue. My special expertise is global but we are currently in the dog house because of the strong dollar. It is about to reverse.

Today we have two results reported for Q3 and so I am not going to hold forth except to note that pot is now legal in Canada (cf the headline). Wall Street opened down and Pres. Trump stated that he would not take the blame if Republicans lost the midterm House elections. I am not sure if they are related.

We have results from Sweden and Switzerland plus news from Israel,

Note that not publishing interim profits, which is supported by Pres. Trump for US companies, already applies in Switzerland and our reporting company merely said it expects earnings to move in line with sales (while also promising a higher payout in Swiss francs, which gives you a hint on where profits are going.) I am not sure whether this kind of information manipulation is what our leading information manipulator intended. The quarterly release was 56 pages long, and Kein Wort appeared about earnings.

Reader Moon KW yesterday stressed the importance of quarterly reporting news on the TalkMarkets site and I agree. The Swiss firm posted year to date (9-mo) numbers rather than quarterly ones.

*Swedish fund Investor A/B saw its Q3 profits boosted 5-fold to SEK 25.6 bn krona from prior Q3, mostly from one minor specialist funds plus the main fund. Net asset value rose 7% sequentially in the quarter to SEK 372.37 mn, boosted by listed core assets up 12% (13% counting dividends paid.) Major subs of the fund gained 14% partly from exchange rate factors. The fund invests on behalf of the Wallenberg family of Skandinavska Enskilda Banken and other firms the clan controls, including their pension funds. We own it in the absence of a Scandinavia Fund. IVSBF for US holders and INVE-A.SK for others. More fund news below.

Drugs

*Swiss Roche, RHHBY, produced 56 pages without a word about profits but a few hints. Its sales rose to Swiss francs 42.1 bn 7% in the year to date in both SwFr and constant currencies, mainly from pharma with lots of new drug approval, while diagnostics sales rose 6%. The recent approvals include: Hemlibra for hemophilia A without factor VIII inhibitors for all ages in the US; Actemra for juvenile idiopathic arthritis; Alecensa for lung cancer in China; and ocrevus for multiple sclerosis. RHHBY also got US breakthrough therapy okay for Xolair to treat severe allergy after accidental exposure, using prefilled syringes. It got EU okay for its treatment for Huntington's disease.

Its cancer drugs Perjeta, Alecensa, and Tecentriq grew sales faster than other drugs which had lost sales, like Rituxan and Tarceva, older meds.

By country, the US saw the most significant rise, to 41% of drug sales from under 39%. US sales increased 14% y/y to date. All other regions registered a lower proportion of sales including Europe, down 8%. It confirmed its earlier forecasts that profits would move in the same direction as sales, which I could have guessed, mid-single digits and a higher payout of dividends in Swiss francs.

It will payback a billion CHF of bonds with new issues of CHF 2.3 bn. It expects to gain from the US tax cuts last year and—critically--expects exchange rates to remain low-impact for the rest of 2018.

To help reach the profits it won't spell out, Roche is giving the chop to some of its pipeline according to Nick Paul Taylor of fiercepharma.com blog, notably RG6125 for rheumatoid arthritis which was in phase II. It paid $105 mn upfront for the drug to Adheron Therapeutics which also expected milestones. It is also cutting jobs in Switzerland and possibly in regional offices, but CEO Severin Schwab did not confirm manning level cuts here in the conference call.

*Teva fell 3.4% at the opening because it did not get Express Scripts coverage for its new migraine drug Ajovy. The pharma benefits management intermediary negotiates with drugmakers to get price discounts it pockets, and TEVA didn't offer a big enough metziah (Hebr: bargain.)

*Minnesota's Attorney General is examining possible price-fixing in insulin by companies taking advantage of medical insurance for diabetics. Among those targeted I Danish Novo Nordisk. NVO is an unlikely culprit because it is controlled by a non-profit and is very dependent on diabetic meds. It began trails of Ozempic (together with Anthem) in comparison with other diabetes drugs today.

Energy

*The latest revelations of Saudi Arabian horrors means that it is unlikely to cooperate with the US to keep down prices after problems in Venezuela and a crackdown against Iran. So oil will cost more, despite the President's support of Prince Mohammed Bone Surgeon's version of what happened to Khashoggi.

*However US crude stockpiles rose again for the 4^th week in a row so some expect the price of oil to be steady or lower. WTI fell 2.8% today. I think this will reverse particularly if the current cold weather in my region continues.

*Orocobre (OROCF) published a revised notification on its annual meeting in Oz Nov. 23. I have not yet received a proxy from the Australian company, part-owned by the Argentine state where it produces most of its lithium, and part-owned by Toyota of Japan.

*An analyst at Chicago's Zacks with poor English upgraded Ormat, a bonus stock in geothermal energy to hold from sell. I am surprised that someone who cannot write grammatically is being published without editorial oversight but I guess it saves money. NYSE-ORA is incorporated in Nevada and trades both here and in Israel where its majority shareholders are. It rose 4.2% in Tel Aviv yesterday. A caveat from the writer: “However the company's business are subjected to uncertainties associated with oil and gas exploration... and on power transmission owned and operated by others” which may make it hard to deliver power if transmission is disrupted or capacity falls. I have no idea if this makes sense even if translated into English.

*My best performing biotech is not in the model portfolio as it is a US firm, EyePoint Pharma (EYPT) which rose 200% this year while the S&P 500 only gained 3.5%. It makes an FDA-approved implant against the 3rd leading cause of blindness, uveitis, which can be placed in a doctor's office.

Tech

*Autoliv's target price was chopped to $72 from $80 by Barclay's brokerage. The Swedish firm makes airbags and seatbelts and ALV recently spun out its electronic parts supplier, Veoneer, VNE.

*Helsinki Partners Oij was a top-15 equity fund manager year-to-date. Its 5^th largest holding according to Bloomberg yesterday is Mercado Libre, MELI, a dollar-currency operator of internet marketing in Latin America HQ'd in Argentina.

*Canada's CAE expects the number of business pilot jobs to fill over the next 10 years at 50,000. It makes simulators and training systems for civil and military aviation and some medical specialties, but this is its first forecast for business pilot demand. The total need will reach 65,000 in 2028, 10,000 for new business jet flying, and 40,000 because of retirement attrition.

Food & Beer

*Anheuser Busch InBev (BUD) had its target price raised to $117 by Trefis analysts, 37% over the current price for the Belgian-based brewery. The main reason is that despite its history and ticker symbol, BUD is only selling 23% of its output in the US; while Latin America accounts for 37% and other fast-growing emerging markets and Europe making up the rest. ABI is mainly traded in Belgium now and its US volume is smaller.

*A caveat on the sale of its US arm to H-Food LLK, (Hearthside Foods LLC) took down Greencore Group plc, the Irish maker of ready meals primarily listed in London, GNCGY. It expects to receive $.1.075 bn for the US businesses it bought over the past two years. Now S&P Global Ratings warns that H-Food already is 8.5x leverage and it has placed the buyer on negative credit watch. So far we have no idea where H-Food expects to get the funds.

Funds

*SPDR Gold, GLD, is rising along with the yellow metal, as I expected. It is an inflation hedge and with Pres. Trump attacking the Fed for raising rates, gold is in play. Short sellers who didn't expect gold to move up with the dollar got caught and have to buy now. Today it fell back giving newbies a buy opportunity.

There were no responses to my offer yesterday on emerging markets airport plans. To get more subscribers I offered a free 3 month trial to anyone able to identify another country with third-world airports (cited by John Llewellyn in his screed about the problems of infrastructure in NYC). The hint is that there work is beginning on generating public support for an upgrade or a new airport. Reply to vivian@global-investing.com. First correct guess wins.