Luxury and fashion stocks fall, China worries dampen sentiment

Shares in luxury goods and fashion companies came under pressure on Wednesday following mixed economic data from China.

Although the country achieved its own economic growth target for 2023, the property market remains weak and consumer sentiment is weak. Unclear prospects for demand in China had already weighed on luxury stocks from time to time recently, as the country is a very important market for companies.

LVMH and Kering shares fell by 1.5 and 2.6 per cent respectively in the morning. Richemont and Swatch also fell.

On the German market, the shares of fashion tailor Hugo Boss lost 2.5 per cent, but at least remained above the previous day's low. On Tuesday, the Hugo Boss share price fell by almost ten per cent after the company's disappointing annual outlook.

In the DAX, the Adidas share price fell by 2.9 per cent. Puma fell by as much as 5.6 per cent in the MDax to a low since November 2022.

Zalando at a record low

Zalando shares continued their downward slide on Wednesday, hitting a record low. In early Xetra trading, the share price fell below the 17-euro mark for the first time since the IPO in 2014. The share was last traded at 16.45 euros, down 4.3 per cent on the Xetra closing price from the previous day.

Analyst Geoffroy de Mendez from Bank of America cancelled his buy recommendation for the online fashion retailer's shares after around one year. However, with a target price of 21 euros, he still sees some recovery potential after the rapid decline in the share price in recent months.(DPA)