Bottlegate
Imagine having so much clout that you could wipe away $4 billion in market value from the world’s largest beverage company. On Monday, soccer superstar Cristiano Ronaldo might have done just that.
At Monday’s Euro 2020 news conference, the Portugal captain removed two coke bottles when he sat down to speak to the media ahead of Tuesday’s match against Hungary. He then held out a water bottle and said, “Agua!” — Portuguese for water. By the end of the conference, shares of Coca-Cola were trading down 1.6% — the company had lost $4 billion in market value.
Ronaldo has already expressed his opposition to Coca-Cola and other harmful foods and drinks. On a typical day, he eats six meals and takes five naps as part of his workout program. And as people become more mindful of health and wellbeing, carbonated soft drink businesses are under pressure. But would Ronaldo’s actions alone stop people from drinking their favorite fizzy drink?
The dip in shares of Coca-Cola could be a coincidence linked to Ronaldo’s remarks. Celebrities certainly influence the way consumers see brands, but only to a limited level for a renowned brand like Coca-Cola.
The way Coca-Cola’s stock plunged after Ronaldo’s comments reminds me of bitcoin’s price action after tweets made by Tesla CEO Elon Musk. Musk frequently made tweets about the price of bitcoin, sending the cryptocurrency’s price up and down.
Do celebrities have a more significant influence on markets than initially thought, or are these situations purely coincidental?
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.
