LVMH shares rose after the French handbag maker's sales topped analyst estimates, proving its resilience amid the luxury industry's slowdown and boosting the shares of its struggling rivals.
The stock gained as much as 5.2 per cent to €165.15, the highest price in almost 11 months, in early Paris trading on Tuesday, before closing at 164.35
Third-quarter sales rose 6 per cent on an organic basis, beating the 4 per cent expected by analysts, fuelled by increased demand for leather goods and fragrances.
LVMH led gains in stocks such as Burberry Group and Kering, the owner of Gucci.The luxury industry had been grappling with weaker demand in Asia, only exacerbated by a slowdown in tourism to Europe amid fears of terrorist attacks.
Last month, Richemont, the maker of Vacheron Constantin timepieces, warned that first-half earnings fell about 45 per cent amid a slump in demand for Swiss watches, and Hermes International abandoned a long-term sales growth target.
"The strong performance of the fashion and leather goods division and commentary about improvement in Asia should be taken positively for the soft luxury industry as a whole," Zuzanna Pusz, an analyst at Berenberg, wrote in a note.
Bloomberg
