Climatic oddities are delivering a reminder that the butterfly effect is alive and well in business. A northern hemisphere summer marked by extremes, and a strong El Niño warming phenomenon expected to trigger more disasters, have set wings flapping. For multinationals, supply chains are vulnerable. The miner Rio Tinto warned earlier this year of a revenue shortfall of more than $800mn because tropical cyclone Narelle in March, and Mitchell in February, made it more difficult to produce and ship iron ore. This compounds with more subtle effects, such as the lower productivity triggered by creeping heatwaves. MSCI found last year that 11,000 major companies faced more than $1tn in annual lost revenue opportunities as a result of all types of extreme weather.

Water distribution is a problem, sometimes because low levels in rivers such as the Rhine or Danube affect shipping routes, researchers at RBC Sustainable Perspectives note. El Niño-linked drought has already cut into the Panama Canal's shipping capacity this year. French utility EDF cited a sharp drop in hydropower due to heatwaves as one reason ebitda will fall 10 per cent in 2026. It temporarily shut down three reactors at the height of the June and July heatwaves, after facing heat-related limits on the water it uses for cooling.

At least the changing climate is leading to some investment into research, development and reconstruction. EDF says it will spend €8.7bn by 2040 to adapt nuclear, hydropower and island activities to weather events. MSCI has seen renewed interest in data about street or factory-level risks, spurring on its acquisition of data provider First Street. As always in finance, there are some who profit. Extreme heat, drought and wildfires cropped up in 10 per cent of big European companies' earnings calls, Alpha Sense data shows, and not always in a negative sense. UK retailer Halfords raised its forecast for the fiscal year's profit after sunshine increased sales of bikes and tents. Perimeter Solutions, a US-based maker of firefighting products, last month predicted higher demand for its fire-retardant products.