In this edition of Kroll's European Chemicals Update, we evaluate current trends for key raw materials, prevailing investor sentiment and valuation developments in the featured pharma chemicals sub-sector.

Our top insights are detailed below.

Key raw materials in the chemicals sector trended downward in Q1/Q2 2020, following a steep fall in crude oil prices. Output cuts, macroeconomic concerns and a fall in demand from COVID-19 continued to suppress Brent crude prices in Q2 2020. This trend will likely prevail until the end of the year.

Next, the ifo Business Climate Index for the German chemical industry remained negative in Q2 2020. Current conditions trended further downward in Q2 2020; however, expectations reversed into positive territory, implying that companies are optimistic for the near future, despite current challenges.

European Chemicals Update – Q3 2020

Finally, in the pharma chemicals sub-sector, market capitalization increased for the featured companies, driven by a strong period of demand resulting from the pandemic.

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