European luxury stocks jump after Richemont smashes expectations (updated)
16/01/2025 09:09
(Adds analysts comment in paragraph 3-6, updates share move)
Jan 16 (Reuters) - European luxury shares soared on
Thursday as Cartier owner Richemont's CFR.S third-quarter
sales beat revived optimism for the battered sector.
Richemont shares jumped around 16% to an all-time high of
161.40 Swiss francs, surpassing their May 2023 high of 161.10
francs, and were set for their biggest intraday rise since
October 2008.
Analysts at JPMorgan saw the 14% growth in Jewellery Maisons
as particularly impressive, while strong acceleration in
Specialist Watchmakers and in the Other division possibly hinted
at stronger-than-expected luxury spending during the Christmas
season.
Luxury goods companies have fallen out of favour in
recent months, as investors have worried over high-end spending
potential in China, the largest market.
"Although still fragile, the market is showing signs of
stabilisation, with easier comps in the coming quarters,"
Vontobel analyst Jean-Philippe Bertschy wrote in a note to
clients.
Investors will likely focus on how much of Richemont's
strength is company- and brand-specific, rather than a
reflection of a broader improvement in the sector, JPMorgan
analysts said, concluding that "it might be a combination of
both."
At 0858 GMT shares in French luxury companies LVMH LVMH.PA
and Gucci owner Kering PRTP.PA were both up around 7%. Italy's
Moncler MONC.MI and Burberry BRBY.L also both rose some 7%.
Birkin bag maker Hermes HRMS.PA was up 5%.
A broader index of European luxury stocks .STXLUXP soared
over 7%, set for its largest one-day rally since its inception
in May 2022.
(Reporting by Linda Pasquini, Samuel Indyk and Anna Pruchnicka;
Editing by Amanda Cooper)
((linda.pasquini@thomsonreuters.com; +48 58 7785261;))