European tire stock prices plummet as euro grows weaker
Tire stock prices in Europe are suffering on two fronts. After significant gains early in the year, stock prices have suddenly dropped to below Jan. 1 levels. The rapid weakening of the euro vs. the dollar isn't helping, either.
In the first month of the year, stock prices in euros for Groupe Michelin, Continental AG and Pirelli SpA rose. The exchange rate of the euro varied very little vs. the dollar during that time, resulting in the following gains:
However, the euro has gotten progressively weaker since then. Also, interest in all three stocks has waned. As of today, the U.S. dollar value for the three are $34.90 for Michelin, a 9.1% drop in almost two months; $16.30 for Continental, a 4.6% drop; and $3.30 for Pirelli, a 13.1% drop.
The yen hasn't fared any better vs. the dollar. But Bridgestone Corp.'s stock price has risen steadily, from $9.09 at year's end to $9.43 on Jan. 31 to $10.26 as of today.
Goodyear Tire & Rubber Co. and Cooper Tire & Rubber Co. enjoyed early gains as well. Although their stock prices have since declined, they are still higher than they were at the beginning of the year.