Sales of expensive handbags and designer clothing have slid at many top brands including Dior and Gucci after a post-pandemic boom, and investors are now keenly tuned in to any signals of the sector returning to growth.

So far, it’s a mixed picture. In addition, recent broader AI-related selloffs on the United States stock market risk dampening the spending power of high-end consumers, while hedge funds’ wagers on luxury stocks are exacerbating price moves.

Shares in LVMH, the world’s biggest luxury group with a 260 billion Euro ($308.49 billion) market cap, suffered their biggest one-day fall since 2020 late last month after Chief Executive Officer, Bernard Arnault struck a cautious tone for the year ahead, dashing hopes of a swift recovery. LVMH’s previous market update, in October, had driven its shares up 12%,  the best day in more than two decades.

–Reuters–