A broad-based luxury corner selloff swept European markets as money managers grappled with a slowdown in the US economy.
LVMH stock (ticker: MC) finished Tuesday’s session to the downside after markets pulled away from Europe’s booming luxury sector. The world’s biggest luxury conglomerate lost 5% of its valuation in a wider selloff that was specifically consolidated in the luxury stocks corner.
The Paris-based powerhouse, which became Europe’s first $500bn company, has been a bright spot across European bourses. Its shares have rallied a whopping 23% from the start of the year, even after yesterday’s relatively modest decline which landed the company’s valuation to just over $400bn.
So what drove the selloff yesterday? A slowing US economy is flashing warning signs that Americans might pare back their lavish spending on luxury goods. A dampening demand for Louis Vuitton handbags, Christian Dior gowns, and Tiffany rings could dent LVMH’s sales growth, which has been on a steady rise for years.
