Alcohol shares dip after US Surgeon General's call for cancer warnings

US Surgeon General’s call for cancer warning labels on alcoholic drinks has cost business to booze makers as their shares dropped after the revelation.

Vivek Murthy, the US Surgeon General, urged alcohol manufacturers to display cancer warnings on drinks, creating a buzz among people.

“Alcohol consumption is the third leading preventable cause of cancer in the United States, after tobacco and obesity,” Murthy’s office said in a statement accompanying the new report, adding the type of alcohol consumed does not matter.

Stocks tumble after advisory

Shares of Jack Daniel’s parent Brown-Forman slipped nearly 3 per cent to $37.10 in early US trading hours, hitting their lowest since April 2017, while Coors Light beer maker Molson Coors fell 2.7 per cent.

Constellation Brands, the maker of Corona beer, slipped 1.3 per cent, while Boston Beer was down 3 per cent after falling as much as 6.4 per cent.

In Europe, shares of the world’s top spirits maker Diageo were down 3.7 per cent to their lowest since mid-December at 1530 GMT, after falling as much as 4.1 per cent earlier.

French spirits maker Pernod Ricard, which owns Martell cognac, Mumm champagne and Absolut vodka, was down around 3 per cent, while its peer Remy and Italian spirits group Campari were both down at least 4.5 per cent.

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Will Murthy’s advisory be adopted?

It is, however, not yet clear whether the surgeon general’s advisory will be translated into action or not. Moreover, US President Joe Biden’s administration is ending. Murthy could be succeeded by Janette Nesheiwat, a director of a New York chain of urgent care clinics and President-elect Donald Trump’s pick for the role.

Meanwhile, Trump, whose own brother died of alcoholism, has been a strong critic of the ill effects of alcohol. Robert F. Kennedy Jr., Trump’s nominee for Secretary of Health and Human Services, has been open about his past struggles with heroin and alcohol and says he attends Alcoholics Anonymous meetings.

With inputs from Reuters