US chem shares soar on 90-day tariff pause

HOUSTON (ICIS)–US-listed shares of chemical companies skyrocketed on Wednesday as the biggest market rally occurred in five years, amid news that the US will adopt a 90-day pause on its reciprocal tariffs.

The following table shows the major stock indices followed by ICIS:

Index	9-Apr	Change	%
Dow Jones Industrial Average	40,608.45	2,962.86	7.87
S&P 500	5,456.90	474.13	9.52
Dow Jones US Chemicals Index	776.26	62.55	8.76
S&P 500 Chemicals Industry Index	829.53	63.68	8.31

PAUSE ON RECIPROCAL TARIFFS
US President Donald Trump announced a 90-day pause on higher reciprocal tariffs, lowering them to 10% for most countries; however, China will see a higher rate of 125%.

The following is the entire post from Trump:

“Based on the lack of respect that China has shown to the World’s Markets, I am hereby raising the Tariff charged to China by the United States of America to 125%, effective immediately. At some point, hopefully in the near future, China will realize that the days of ripping off the U.S.A., and other Countries, is no longer sustainable or acceptable. Conversely, and based on the fact that more than 75 Countries have called Representatives of the United States, including the Departments of Commerce, Treasury, and the USTR, to negotiate a solution to the subjects being discussed relative to Trade, Trade Barriers, Tariffs, Currency Manipulation, and Non Monetary Tariffs, and that these Countries have not, at my strong suggestion, retaliated in any way, shape, or form against the United States, I have authorized a 90 day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10%, also effective immediately. Thank you for your attention to this matter!”

CNBC reported that the 10% tariff will not apply to imports from Canada and Mexico.

Earlier, the Wall Street Journal reported that US will also impose the 10% tariff on imports from Canada and Mexico during the 90 days. Trump did not mention Mexico and Canada in his post, and it is unclear if the US would exempt imports that comply with the nations’ trade agreement, known as the US-Mexico-Canada Agreement (USMCA).

In addition, the 90-day reprieve does not include the steel and automobile tariffs imposed by the US, as those were not part of the reciprocal tariffs.

Seemingly, countries that imposed retaliatory tariffs are still getting the 90-day reprieve as long as their actions were not in response to the reciprocal tariffs.

RETALIATORY TARIFFS KICK IN
Canada’s 25% tariffs on US-made vehicles went into effect. This applies to the content of fully assembled automobiles that do not comply with the USMCA as well as vehicles that do not comply with the trade deal.

China’s government will raise the tariff on US imports from 34% to 84% effective on 10 April in response to the reciprocal tariffs.

EU states approved retaliatory tariffs on several US imports in response to its steel and aluminium duties. The EU tariffs go into effect on 15 April, covering several grades of polyethylene (PE).

CHEMS GET BREAK FROM TRADE WARS
US tariffs have battered chemical shares, with some trading near lows seen during the COVID pandemic.

For the past couple of years, chemical companies have endured a slowdown in the housing market and a recession in manufacturing, lowering demand for many key plastics and chemicals used in construction and durable goods.

Exports had provided US producers a lifeline because they enjoyed a cost advantage against much of the world. The prospects of retaliatory tariffs by other countries would cut that.

Meanwhile, energy prices have been moving in the wrong direction for US chemical producers. US feedstock costs tend to follow prices for natural gas. Sales prices for petrochemicals tend to follow those for oil.

Crude prices have fallen because of worries that the demand will decline due to a downturn caused by the tariffs. Natural gas prices have remained elevated.

These two trends are squeezing US margins.

The following table shows the US-listed shares followed by ICIS:

Symbol	Company	Price	Change	Change %
ASIX	AdvanSix	21.11	2.42	12.95%
AVNT	Avient	32.89	3.96	13.69%
AXTA	Axalta Coating Systems	31.76	3.27	11.48%
BAK	Braskem	3.27	0.36	12.37%
CC	Chemours	11.88	2.3	24.01%
CE	Celanese	43.9	6.41	17.10%
DD	DuPont	61.95	6.82	12.37%
DOW	Dow	29.86	4.05	15.69%
EMN	Eastman	81.48	8.78	12.08%
FUL	HB Fuller	53.78	5.35	11.05%
HUN	Huntsman	14.26	2.01	16.41%
KRO	Kronos Worldwide	7.11	0.86	13.76%
LYB	LyondellBasell	59.83	6.6	12.40%
MEOH	Methanex	30.29	4.42	17.09%
NEU	NewMarket	549.66	29.71	5.71%
NGVT	Ingevity	33.4	3.52	11.78%
OLN	Olin	21.98	4.02	22.38%
PPG	PPG	103.11	11.45	12.49%
RPM	RPM International	105.64	8.67	8.94%
SCL	Stepan	49.69	4.43	9.79%
SHW	Sherwin-Williams	336.25	22.74	7.25%
TROX	Tronox	5.39	0.88	19.51%
TSE	Trinseo	3.34	0.44	15.17%
WLK	Westlake	93.73	10.65	12.82%

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Visit the ICIS US tariffs, policy – impact on chemicals and energy topic page.

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