European Cognac Makers Toast Omission From U.S. Tariff List

   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 [e-mail]; @_cristinaroca

(END) Dow Jones Newswires

October 03, 2019 04:48 ET (08:48 GMT)

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