FRANKFURT (Reuters) - German chemicals giant BASF's (DE:BASFn) shares fell 7.2% in early Frankfurt trading on Tuesday after the company warned that its adjusted operating profit will drop 30 percent this year, blaming a global trade war.
The company mainly blamed a global economic slowdown and trade war between the United States and China for worse-than-expected results.
"Everybody expected a warning. But not to that extent.
...Really disastrous numbers," said a trader.
The maker of petrochemicals, coatings, catalytic converters and foams warned full-year earnings before interest and taxes (EBIT) excluding special items would fall up to 30% below 2018 levels, instead of showing modest growth.
Sales are now expected to fall in 2019 rather than rise, the company said.
Shares in sector peers Covestro (DE:1COV) and Lanxess (DE:LXSG) also fell in sympathy.
German chemicals industry association VCI last week had warned of falling revenues on slower economic growth, weakening industrial activity and uncertainty caused by global trade conflicts.