Alcohol stocks fall after US surgeon general calls for cancer warnings

Shares of European and US spirits makers and brewers fell on Friday after the US surgeon general called for cancer warnings on the labels of alcoholic beverages.

The consumption of alcoholic beverages increases the risk of developing breast, colon, liver and other cancers, US Surgeon General Vivek Murthy said in an advisory.

“For certain cancers, such as breast, mouth and throat cancer, evidence shows that the risk of developing cancer may begin to increase around one or fewer drinks per day,” according to the guidance.

Shares of Jack Daniel’s parent Brown-Forman fell nearly 3% to $37.10 in morning trading, hitting their lowest since April 2017, while Coors Light beer maker Molson Coors fell 4%.

Constellation Brands, the maker of Corona beer, fell 1.3%, while Boston Beer fell nearly 6%, the biggest drop since last February.

It is unclear when or if the surgeon general’s proposal will be implemented. The decision to update the label will ultimately be made by Congress.

“Most Americans tend to believe that almost anything is okay in moderation, so as much as warning labels alone on cigarette packs did little to curb public smoking, I expect warning labels on alcohol to have little effect,” said Michael Ashley Schulman, partner and boss. investment officer at Running Point Capital Advisors.

In Europe, shares in world-leading spirits maker Diageo fell about 3% to their lowest since mid-December, after falling as much as 4.1% earlier.

French spirits maker Pernod Ricard, which owns Martell cognac, Mumm champagne and Absolut vodka, fell around 3.2%, while its peer Remy and Italian spirits group Campari both fell around 3.8%.

Breweries were also hit, with Budweiser maker Anheuser-Busch InBev down about 2% and Heineken and Carlsberg down between 1% and 1.5%.