In a dramatic shift on Tuesday, Hermès overtakes LVMH to become Europe’s most valuable luxury goods company by market capitalization. The move came as LVMH shares plunged 7%, wiping billions off its market value after the fashion giant reported weaker-than-expected first-quarter results.
Once comfortably leading the sector, LVMH Moët Hennessy Louis Vuitton saw its valuation tumble to €246 billion, just below Hermès’ €247 billion, amid growing investor concern over the broader luxury retail outlook.
The Paris-based conglomerate, which owns global fashion titans such as Louis Vuitton, Dior, Tiffany & Co., and Sephora, reported a 3% sales decline in Q1 2025—far short of analysts’ expectations of 2% growth.
U.S. consumers have pulled back spending on cognac and beauty products, while sales momentum in China, a traditionally strong market for luxury, also remained sluggish.
Analysts point to LVMH’s broader product portfolio—including entry-level luxury items—as a potential weakness in times of economic uncertainty. In contrast, Hermès, known for its ultra-premium Birkin and Kelly bags priced upwards of $10,000, continues to benefit from a highly loyal, ultra-wealthy clientele and a limited-supply strategy.
“LVMH’s mass appeal now seems to be its weak spot,” said GAM’s luxury fund manager Flavio Cereda. “Hermès’ disciplined growth and elite positioning are giving it an edge in a post-pandemic slowdown.”
Tuesday’s market rout wasn’t limited to LVMH:
With LVMH leading the decline, luxury stocks across Europe have now fallen sharply since the end of March. Shares in Burberry, Richemont, and Kering are all down over 13–14% over the past two weeks, while Hermès has dropped a more modest 5%.
Following the disappointing results, several financial institutions have lowered their outlook for the luxury sector:
This comes amid rising global recession fears, especially after new U.S. tariffs were announced by President Trump, creating further uncertainty for exporters and luxury brands dependent on international markets.
The turbulence in luxury stocks is not just about fashion—it reflects larger macroeconomic concerns such as trade tensions, consumer spending slowdowns, and recession risk. For forex traders on DailyForex.pk, this signals potential volatility in EUR/USD and CHF pairs, as Europe’s luxury sector is a major economic pillar.
Keep an eye on earnings releases, tariff developments, and Chinese consumer sentiment, which remain key drivers for luxury-linked equities and currencies.
Hermès may be winning the market cap race today, but the entire luxury sector is at a crossroads. As global consumers tighten their belts and trade conflicts intensify, brands with narrow, elite appeal like Hermès are thriving—while more diversified empires like LVMH must navigate a tougher road ahead.
Stay updated on global market shifts and luxury sector insights only on www.DailyForex.pk — your source for smart investing, forex trends, and market-moving news.
GBP/USD edges higher toward 1.3450 as dovish Fed comments support the Pound, despite mixed UK…
Bitcoin approaches record highs, Ethereum targets the $4,000 mark, and Ripple (XRP) hits a new…
EUR/USD climbs past 1.1600 as the Fed’s dovish stance calms market nerves, boosting demand for…
EUR/JPY holds above the 100-day EMA, maintaining bullish momentum, though overbought RSI levels suggest a…
Gold (XAU/USD) rebounds off key support, with bullish momentum building as traders watch for further…
USD/JPY and AUD/USD remain sensitive to Fed and BoJ policy signals, while US market sentiment…
View Comments
Kudos. Plenty of tips!
meilleur casino en ligne
Amazing a good deal of fantastic information!
casino en ligne
Amazing a lot of beneficial material!
casino en ligne
Very well spoken truly. .
casino en ligne France
Amazing plenty of awesome facts!
casino en ligne
Nicely put. Regards.
casino en ligne francais
Many thanks, I value it!
casino en ligne France
You said it very well.!
casino en ligne
Superb content Many thanks.
casino en ligne fiable
Thanks a lot, Ample posts!
casino en ligne