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RICHEMONT RESULTS: WHAT IT MEANS FOR THE LUXURY SECTOR

Richemont shares have jumped almost 17% on Monday after their fourth-quarter sales figures, set for their biggest daily rise since 2008, as sales rose 10%, well above consensus expectations for a 1% increase.

The STOXX Luxury 10 index .STXLUXP is up almost 8%, its biggest daily jump since inception in May 2022, as Richemont's competitors rise in sympathy. LVMH, Moncler, Christian Dior and Kering are all up around 9%.

But what does it mean for the sector as a whole?

Deutsche Bank takes a look.

"This will add to the debate that the more premium luxury brands are likely to outperform, the luxury slowdown is more cyclical than structural (at least at the high end) and that there is enough growth in the rest of the world to offset China weakness," the German bank writes.

Barclays is upbeat too.

"In terms of read-across, the improving trends in America and the absence of further deterioration in China is also reassuring for the rest of the reporting season," they say.

UBS agreed that the sector should act positively today but with an element of caution.

"We note that the implications to other categories, especially leather goods may be risky to extrapolate," UBS says.

LVMH, Europe's largest luxury company, reports results on Jan. 28, which may provide more insight into whether Richemont is executing better than peers, or whether the sector as a whole saw a strong quarter.

(Samuel Indyk)

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THURSDAY'S OTHER LIVE MARKETS POSTS:

UK BANKS: FUNDAMENTALS TOO GOOD TO IGNORE CLICK HERE

LUXURY LIFTS EUROPEAN EQUITIES AFTER RICHEMONT RESULTS CLICK HERE

EUROPE BEFORE THE BELL: FUTURES SIGNAL FURTHER GAINS CLICK HERE

BRIEF RELIEF FOR MARKETS AFTER TAME US INFLATION CLICK HERE