What's going on?

Arch-rivals Unilever and Nestl� � two of the world�s largest consumer staples companies � reported quarterly updates on Thursday. And in a reversal of last quarter, investors sided with Unilever�s stock over Nestl�s.

What does this mean?

Anglo-Dutch Unilever � the gastronomic powerhouse behind Ben & Jerry�s ice cream and Hellmann�s sauces � grew its third-quarter �organic� sales (which excludes the effects of currency swings and acquisitions) by 2.9% versus the same time last year. But that was lower than investors had been expecting, since growth in emerging markets like India, China, and South America wasn�t as high as hoped.


Switzerland�s Nestl�, meanwhile, saw its organic revenue grow by 3.7% over the same period � higher than its rival�s and bang on what investors had predicted. The candy bar-maker probably deserves to have a break after besting Unilever in 2019, which may be the reason Nestl�s stock price had risen by double Unilever�s so far this year.

Why should I care?

Zooming in: Sweet, sweet profits.

Nestl�s outperformance this year might�ve led some investors to sell their shares and lock in their profits on Thursday: its stock fell 2%. And that�s despite announcing it�d give shareholders an additional $20 billion via share buybacks or extra dividends over the next three years, following the successful sale of its skincare business (unless it finds another company to buy instead). A higher-growth and more profitable post-sale Nestl� should attract new investors, not to mention please existing ones.

For markets: You�re being so defensive.

Consumer staples companies sell products people buy whatever the economic weather. In other words, they�re �defensive�. As economic growth slows then � UK retail spending, for instance, froze in September versus August � investors will look for companies where customer demand is typically resilient even if prices get raised, which could push their stock prices higher (tweet this).