Share price of Nestle reaches 8-month low

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  • Nestlé said it will invest CHF 3.2 billion to achieve its target of net zero emissions by 2050.
    A major financial commitment will be financed through operational and structural efficiency
    Nestle share price plummeted and broke below key support close to 102.00

    This week, Nestle (SIX: NESN) shares are trading around 2.5% in the red in order to break through the important short-term support near the 100 level.

    Basic analysis: Nestle enters into a net zero issuance commitment

    Nestle, one of the world’s largest food producers, said it will invest CHF 3.2 billion to achieve its target of net zero emissions by 2050. The first milestone is to cut its emissions by half by 2030, while the company will work to use only renewable energy sources at its 800 global sites by 2025.

     

     

     

    Last year, Nestle committed to net zero emissions by 2050, a goal it aims to achieve in part by reducing business travel by 2022 and increasing the number of “carbon neutral” brands it offers.

    “Climate change is one of the greatest threats we face as a society. It is also one of the biggest risks for the future of our company,” said Mark Schneider, CEO of Nestlé.

    “We are running out of time to avoid the worst effects of global warming. We are therefore more courageously committed to achieving a net zero future. By leveraging Nestlé’s global resources and industry expertise, we know that we can make a significant difference. Our journey towards a net zero future has already begun. Now we are accelerating our efforts,” he added.

    A major financial commitment will be financed through operational and structural efficiency, the company said. It also said it plans to work with farmers and vendors to “adopt regenerative farming practices.

    Nestle will also increase the scope and pace of its reforestation strategy by planting 20 million trees each year by 2030.

    Technical analysis: Stocks break important support

    Nestle’s share price is trading about 2.5% lower this week to continue the downward trend that has led to losses of over 10% since October. Buyers are concerned about the penetration below the key support at 100 – 102, a zone where the 100-WMA and horizontal support is located.

    Nestle Stock Weekly Chart (TradingView)

    This pause is likely to accelerate the downtrend, with the first target on the downside at 97.80. The broken support line around the 102.00 level will now act as resistance.

    Summary

    Nestle announced its plans to make significant investments to reduce gas emissions by 2050. In the meantime, the shares plummeted and collapsed under important support.

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