Processed food stocks tumbled on Friday as investors feared a crackdown under President-elect Donald Trump and ally Robert F. Kennedy Jr.
Soda titans PepsiCo and Coca-Cola dropped more than 3% and 1%, respectively, in late-day trading Friday. Cheerios cereal and Betty Crocker cake mix maker General Mills fell about 3%, as did Conagra Brands, maker of Reddi-wip.
Campbell Soup, which makes Goldfish crackers and Pepperidge Farm cookies, also retreated more than 3%. Kraft Heinz, known for its macaroni and cheese and Oscar Mayer hot dogs, eased more than 1%.
Frozen potato supplier Lamb Weston, whose french fries are sold in chains including McDonald’s and Chick-fil-A, dropped more than 5%.
The declines came after Trump named Kennedy as his nominee for secretary of the Health and Human Services Department, which oversees the Food and Drug Administration and Centers for Disease Control and Prevention, among dozens of federal agencies. Trump’s selection of Kennedy, a noted vaccine skeptic and conspiracy theorist, drew criticism from some politicians on Capitol Hill as well as public health experts.
If Kennedy wins approval from the Senate, he will also oversee Medicare, Medicaid and the National Institutes of Health.
Traders are wary that Kennedy’s “Make America Healthy Again” focus will result in increased scrutiny of companies behind some of the best-known snack, packaged food and soft-drink brands. Kennedy, who ran as an independent candidate for president before throwing his support behind Trump, has pushed for major changes to the FDA, including the removal of nutrition departments.
“They’re not protecting our kids,” Kennedy said of current regulators in an interview with NBC News last week. “Why do we have Fruit Loops in this country that have 18 or 19 ingredients and you go to Canada and it’s got two or three?”
Fruit Loops are made by WK Kellogg Co., whose stock is higher Friday but down more than 4% on the week.