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Investing.com - Barclays (LON:BARC) downgraded Arkema SA (EPA:AKE) stock rating from Overweight to Equalweight and reduced its price target to EUR80.00 from EUR107.00 on Tuesday.
The downgrade comes as Barclays revised its full-year estimates for the French specialty chemicals company, which now sit 7% below Arkema’s own fiscal year guidance range. Barclays noted that Arkema could potentially issue the largest FY25 guidance cut among companies it covers when second-quarter results are released.
Arkema’s significant exposure to North American markets, which represent 35% of its sales, and the construction sector (approximately 12%) suggest demand has likely remained subdued, with customers adopting a cautious approach due to tariff uncertainties.
Additional challenges facing Arkema include weak acrylic margins, negative contributions from Dow’s laminates business, and disruption to hydrogen peroxide production following the cessation of Vencorex salt supply, all of which may further impact segment profitability and limit near-term recovery potential.
Despite these headwinds, Barclays acknowledged that abnormally low customer inventory levels in the current environment could support a faster rebound once construction and industrial demand return, though worsening upstream petrochemical margins and prolonged low volume growth remain significant risks.
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