European Cognac Makers Toast Omission From U.S. Tariff List
October 03 2019 - 5:03AM
Dow Jones News
By Cristina Roca
Shares in European premium spirits makers trade higher Thursday
as fears that cognac would be among the products hit by U.S.
tariffs on European goods didn't materialize.
Remy Cointreau SA (RCO.FR) shares shot up at the opening Paris
stock exchange. The bulk of the French drinks maker's operating
profit comes from its premium-range cognac brands. The U.S. market
accounts for about 35% of its sales according to a J.P. Morgan note
from September, which estimated that if the U.S. imposed tariffs on
its goods, its gross profit could take a hit of up to 10%.
Shares in premium drinks maker Pernod Ricard SA (RI.FR)--which
owns the Martell cognac brand--and French luxury-goods group LVMH
Moet Hennessy Louis Vuitton SE (MC.FR),owner of the high-end cognac
label Hennessy, also rose at the open.
The U.S. Trade Representative published late on Wednesday a list
of European goods including French cheese, Spanish olives and other
products that it plans to impose tariffs on after the World Trade
Organization authorized levies on $7.5 billion of EU goods in its
ruling on the block's subsidies to Airbus.
At GMT 0800, Remy Cointreau traded 6.1% higher, Pernod Ricard
was up 3.5%, and LVMH traded 1.4% higher.
Write to Cristina Roca at cristina.roca@dowjones.com;
@_cristinaroca
(END) Dow Jones Newswires
October 03, 2019 04:48 ET (08:48 GMT)
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