Stock prices for U.S.-based materials firms are recovering from Brexit-induced pain — but at a slower rate than that of the overall market.
The United Kingdom's shocking decision to leave the European Union sent global markets tumbling on June 24 and 27. The Dow Jones Industrial Average slid almost 5 percent on those two trading days, but in early trading July 1 was off only 0.2 percent from its pre-Brexit level.
The NASDAQ exchange similarly fell more than 6 percent but was down only 0.8 percent in the same comparison. Most of the 15 plastics materials firms covered by Plastics News haven't been so lucky.
Huntsman Corp. and recent DuPont Co. spinoff Chemours Co. had the steepest Brexit hangovers. Each remained down 14-17 percent in early trading July 1. Executives at both firms desperately need the three-day July 4 holiday weekend.
Stock prices at Westlake Chemical Corp., Kraton Polymers and Hexcel Corp. bounced back nicely but were still down 2-4 percent vs. pre-Brexit numbers. Most remaining materials firms remained down 4-8 percent. This group includes Dow Chemical Co., DuPont, Eastman Chemical Co., PolyOne Corp., Celanese Corp. LyondellBasell Industries, Rogers Corp. and Nexeo Solutions.
(Execs at Nexeo Solutions — a major resin distributor based in The Woodlands, Texas — must be hoping their run of bad luck has ended for 2016. The Brexit impact hit just two weeks after the firm went public.)
The only materials firms that already appear to have moved on from the Brexit are A. Schulman Inc. and Omnova Solutions. Both companies have rallied after releasing positive quarterly results in recent days. Schulman's per-share price is down less than 1 percent from pre-Brexit, while Omnova's stock price actually is up more than 8 percent.
Omnova's headquarters in Beachwood, Ohio, apparently is a Brexit-free zone.