The Strategist

Tobacco companies papers plummet on news of possible tougher regulations on cigarettes


04/21/2021 - 06:47



Information from The Wall Street Journal (WSJ) about US authorities' plans to limit nicotine content in all cigarettes sold on the US market to levels that will not cause addiction, as well as news that authorities may ban the sale of menthol cigarettes, has triggered a sharp fall in tobacco companies' shares.



Kiwiev
Kiwiev
Altria's shares fell 6% and a further 2% in electronic trading in New York on Monday, causing the company's capitalisation to shrink by $6bn. Shares in British American Tobacco and Imperial Brands fell 7.3% in trading in London. 

The only tobacco company that rose was the 22nd Century Group, which makes cigarettes with reduced nicotine content. Its papers gained 11% during trading in New York.

The Food and Drug Administration, which is the watchdog for the tobacco market, refused to comment to the newspaper. 

Altria commented on the reports, stressing that "all decisions should be based on science and facts and should take into account the real consequences of such actions, including the growth of the illegal tobacco market and the impact on hundreds of thousands of jobs, from plantations to shops across the country".

source: wsj.com




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