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Hermès rejected LVMH to become the most valuable luxury company in the world on Tuesday, as shares in the owner of Louis Vuitton collapsed in the back of the disappointing results of the first trimester.
On a bruised morning for the luxury sector in which companies exchanged spots several times, shares in LVMH listed in Paris dropped 7.5 percent, sending the group market capital to 245.3bn €.
Shares in Hermès, the manufacturer of Birkin and Kelly Bags, fell by only 0.4 percent, giving it a market capitalization of € 247.1 billion.
The luxury industry has fought by pursuing a boom in pandemics while middle -class consumers return to China’s expense and the economy is forgiven, factors that are now uniting by the aggressive war of Donald Trump’s trade.
The results of the first trimester of LVMH, recently released Monday, showed that sales in its main fashion and skin split fell 5 percent, much less than the analyst reception per 1 percent growth.
In contrast, the ultra -rich base of hermès customers and the releases of strongly controlled products have enabled it to weather the last slowdown better than its rivals.
Quarterly LVMH LVMH sales sparked a wider sale in luxury actions on Tuesday, with Prada falling 4.2 percent and down 1.4 percent. Shares in L’Oréal and Puig also fell after the results of LVMH hinted for a wider deceleration of beauty.
Hermès has been constantly closing the gap with LVMH in an extraordinary change 15 years after the French Conglomerate tried to buy its smallest rival in a secret attack.
The riots in the luxury industry come as Trump has launched the comprehensive “reciprocal” tariffs in dozens of trade partners, an act that has busy markets and shock the US consumer’s trust.
Earlier this month, the US president announced 20 percent of taxes on goods imported from the EU. This rate was later decreased to 10 percent as part of a 90-day pause for the steepest tariffs.
Tariffs, which were more aggressive than widely expected, brought analysts to Bernstein and HSBC last week to reduce their expectations for a luxury recovery in the second half of the year.
Citigroup analyst Thomas Chauvet said that due to the economic uncertainty generated by Trump’s tariffs, “it is difficult to build a reliable scenario” in which income in LVMH and in the luxury sector generally improved in future quarters.
