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Plastics costs can maintain rising as Dow sees demand persevering with to outstrip provide


The large value will increase that helped increase Dow Inc.’s second-quarter earnings are more likely to proceed, because the plastics and chemical stated Thursday that it expects pent-up demand to maintain outstripping provide within the coming months.

“[S]trong shopper demand traits proceed in retail, housing and the manufacturing sectors, and stock ranges stay low throughout most of our worth chains. We count on these dynamics to proceed to help value traits within the third quarter because the business continues to work to meet pent-up demand.”

— Chief Monetary Officer Howard Ungerleider

Ungerleider’s remark, in keeping with a FactSet transcript, was made throughout Dow’s post-earnings convention name with analysts. It comes amid rising considerations {that a} recent spike in inflation might final, regardless of the Federal Reserve’s call that it’ll fade by year end.

Earlier Thursday, Dow reported second-quarter profit and revenue that rose above expectations, as native value soared 53% whereas quantity elevated 9%.

Pricing elevated 70% in Dow’s packaging and specialty plastics enterprise section, rose 53% in industrial intermediates and infrastructure and grew 16% in efficiency supplies and coatings.

Additionally learn: Harley-Davidson fights inflation with 2% surcharge, but that’s not quite enough.

Learn extra: Worries of ‘rampant’ inflation leads two analysts to abandon their buy rating on Conagra’s stock.

The inventory

edged up 0.1% in noon buying and selling, reversing an earlier intraday lack of as a lot as 2.9%. The inventory has gained 7.7% yr thus far, whereas the SPDR Supplies Choose Sector exchange-traded fund

has superior 11.8% and the Dow Jones Industrial Common

has climbed 13.4%.

Chief Government Jim Fitterling stated the worldwide financial system ought to proceed to enhance off the post-COVID-19 trough, which ought to maintain demand “strong.” On the identical time, he expects provide to stay “tight,” because the robust demand hasn’t allowed the corporate to extend provide.

“[O]ur outlook is that the demand right here and world wide continues to be robust,” Fitterling stated, as he responded to an analyst query concerning polyethylene costs. “I don’t assume you’ll see an opportunity for us to construct any stock by way of the third quarter.”


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