(Reuters) -European luxury shares soared on Thursday as Cartier owner Richemont’s (CFR.SW) 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 (MC.PA) and Gucci owner Kering (KER.PA) were both up around 7%. Italy’s Moncler (MONC.MI) and Burberry (BRBY.L) also both rose some 7%.
Birkin bag maker Hermes (RMS.PA) was up 5%.
A broader index of European luxury stocks 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)