A week of intense recovery


The previous week was for luxury stocks, and markets as whole, marked by an extremely intense recovery set off by the 2 most important Central Banks in the Western hemisphere: the Federal Reserve and the ECB.

First James Bullard, head of St. Louis Fed, then Jerome Powell and finally Mario Draghi in Frankfurt, they all stumbled all over themselves to reassure the markets.

In Frankfurt it was even  hypothesized a new round of quantitative easing. All this talking about monetary authorities coming to the rescue led to a dramatic spike in risky asset prices, after another disastrous inception of the week last Monday.

Once again luxury companies proved to be highly cyclical: as you may notice none of the groups in our draw scored weekly negative returns. Of course the intensity of the rally was not the same across the board, in a couple of cases though we even reached new historical highs.

Even Italian luxury names did extraordinarily well, after a couple of weeks of worrying fragility, par for the course with the rest of the local assets.

What happened can be filed under the textbook case relief rally category. Indeed investors, after getting terrified by the prospect of an all out geo-political clash between China and the US, flocked specifically to some of the most  clobbered investments available.

The picture for luxury stocks though remains far from rosy: definitely having the 2 major central banks of the world involved with rate cuts and monetary stimulus does help, at the same time the need for an acceptable compromise between the 2 superpowers of the world did not disappear overnight.

As long as the situation from this point of view remains murky imagining for luxury another string of strongly volatile weeks in both directions isn’t exactly far-off.

Azienda Performance YTDBorsa 
LVMH 38.28%Parigiup
Estee Lauder 35.94%New Yorkup
Christian Dior33.87%Parigiup
Hermes 26.11%Parigiup
Richemont 24.79%Zurigoup
Moncler 19.94%Milanoup
Tifffany12.37%New Yorkup
Porsche 9.41%Francoforteup
Tod's9.20%Milano up
Ralph Lauren7.17%New Yorkup
Brunello Cucinelli-4.70%Milanoup
Prada-9.69%Hong Kongup
Capri/Michael Kors-9.78%New Yorkup
Tapestry/Coach-10.37%New Yorkup
Tesla -38.55%New Yorkup

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