Shares Drop On Carbon Black Probe

Share values at Cabot Corp and Phelps Dodge fell dramatically after the world’s largest suppliers of carbon black said regulators were investigating whether they conspired to fix the price of the substance used to make tyres. ”We’ve been approached by the European Union and Department of Justice and we are co-operating fully,” Bruce Richardson of Phelps Dodge said. Artificially high prices for carbon black would increase costs for tyre manufacturers which use it to strengthen their products.

Cabot’s shares fell $1.50, or 5.8 percent, to $24.

17 in New York Stock Exchange composite trading. Phelps Dodge dropped $2.18, or 7.

5 percent, to $26.72..