European Stocks Gain as Richemont’s Sales Jump Lifts Luxury

European stocks rose to the highest level in over a month on Thursday, lifted by the luxury and technology sectors as a double-digit jump in Richemont’s sales and an upbeat outlook by Taiwan Semiconductor Manufacturing Co. boosted sentiment.

Author of the article:

Bloomberg News

Allegra Catelli and Margaryta Kirakosian

Published Jan 16, 2025  •  2 minute read

61bllzqe2wqy8tr8ryegebpk_media_dl_1.png Goldman Sachs, Bloomberg

(Bloomberg) — European stocks rose to the highest level in over a month on Thursday, lifted by the luxury and technology sectors as a double-digit jump in Richemont’s sales and an upbeat outlook by Taiwan Semiconductor Manufacturing Co. boosted sentiment.

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The Stoxx Europe 600 Index gained 1% at the close in London, extending the previous session’s gains. The gauge rose by the most in nearly four months on Wednesday following a surprise slowdown in inflation, rekindling bets for an earlier Federal Reserve interest-rate cut.

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Meanwhile, positive results from Richemont reignited optimism for the luxury sector, sending its shares to a record high. LVMH soared more than 8% and Hermes International gained 4.9%. The Goldman Sachs European Luxury Goods index rose as much as 8.8%, the most since March 2020.

The luxury sector “has corrected a lot and incremental positive news could be enough for the sector to perform much better,” said Amelie Derambure, a senior multi-asset portfolio manager at Amundi Asset Management. 

The technology sector also outperformed on Thursday following TSMC’s favorable outlook, buoying optimism about the artificial-intelligence spending cycle. ASML Holding NV rose as much as 4.9%.

European stocks have struggled to sustain a rally after hitting a record high in September, amid worries about potential tariffs from the new Donald Trump administration in the US. The economic growth in the region continues to be sluggish, with the UK gross domestic product falling short of expectations on stagflation concerns. 

The Dax Index underperformed others in Europe weighed down by Siemens Energy AG over incoming President Donald Trump’s potential tariff impact and impact on the wind sector. Orsted AS and Vestas Wind Systems A/S also fell.

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For the recent positive momentum to be sustained “we need to see companies report strong earnings and give constructive future guidance,” said Marija Veitmane, senior multi-asset strategist at State Street Global Markets. “Investors are likely to be unforgiving to earnings misses as support from rate cuts is likely to be minimal this year.”

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• US Stock Futures Unchanged; FTAI Aviation, Netflix Gain
• Surprise Inflation Slowdown: The London Rush

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