Latest news with #RolandKaloyan
Reuters
3 days ago
- Business
- Reuters
European shares slip as investors gauge mixed earnings, US-EU trade progress
July 25 (Reuters) - European shares retreated on Friday, giving back gains from the previous session, as investors assessed mixed corporate earnings while awaiting updates on EU-U.S. trade discussions ahead of U.S. President Donald Trump's tariff deadline next week. The pan-European STOXX 600 index (.STOXX), opens new tab was down 0.4% at 549.36 points, as of 0832 GMT. Still, the index remained on course for modest weekly gains. UK's FTSE 100 (.FTSE), opens new tab dropped 0.4%, pulling back from its all-time peak reached on Thursday. Most regional bourses were also in the red. Investors navigated a busy week of trade discussions and cheered agreements with Japan, Indonesia and the Philippines, while hopes for a U.S.-EU deal remain as negotiations with the bloc continued. "The elephant in the room is earnings. You have the sentiment boosted by the news flow on the tariff side," said Roland Kaloyan, head of European Equity Strategy at Societe Generale. "But we are in the middle of the earnings season, thus, if you have some disappointment coming on that front ... that is not super supportive for the market." European financials (.SXFP), opens new tab led the sector decline with a 1.3% drop, while stocks linked to basic resources (.SXPP), opens new tab fell 0.6%, pressured by Fresnillo's (FRES.L), opens new tab 2.3% drop. Among individual stocks, Puma's ( opens new tab shares slumped 15.1%, falling the most in the STOXX 600 index, after the German sportswear brand cut its full-year outlook and reported weaker-than-expected quarterly results. London-listed sports retailer JD Sports (JD.L), opens new tab fell 1.5%. Valeo ( opens new tab slumped nearly 9% after the French car parts supplier cut its full-year sales outlook. Traton ( opens new tab, a truck unit of German automaker Volkswagen ( opens new tab, came under pressure with a 4.4% decline after it slashed its full-year outlook. On the flip side, Carrefour ( opens new tab gained 6% after Europe's biggest food retailer reported its half-year results. Shares of Volkswagen, Europe's biggest carmaker, were up 2.7% after the CEO said cost cuts must be accelerated in a response to tariffs. Earlier in the session, shares lost 2.4% on the company's revised outlook. NatWest (NWG.L), opens new tab rose nearly 2% after the British bank posted first-half profit above estimates, and announced it would do a 750-million-pound ($1.01 billion) share buyback. On the data front, German business morale improved less than expected in July. Also this week, the European Central Bank held rates steady and gave a cautiously positive view of the economy, dampening expectations for further easing. Attention next week will turn to key events, including policy decisions from the Federal Reserve and other central banks, earnings from several "Magnificent Seven" companies and Trump's August 1 tariff deadline.
Fashion Network
5 days ago
- Business
- Fashion Network
Luxury's split between winners and losers is only getting wider
One striking example of the sector's divide is LVMH versus French peer Hermes International SCA. Sales at LVMH's key Fashion & Leather Goods division are expected to have dropped 7.8% in the second quarter, according to analyst estimates. The company reports after the bell on Thursday. Hermes, which has been an example of how companies can thrive on selling the highest-end items, is expected to report revenue growth of 12% at its leather goods division. Its results are due on July 30. In the case of the Louis Vuitton and Tiffany & Co. owner, the stock has lost roughly half of its value over the past two years, losing its crown of Europe's biggest stock, with investors increasingly worried about an unprecedented demand slump in China. Hermes shares, on the other hand, are weathering the broader industry pullback. After a 160% jump since the end of 2020, the stock is little changed this year versus a 7% drop in Goldman Sachs Group Inc.'s basket of luxury shares. In the current economic context, pricing power is critical, said Helen Jewell, Europe, Middle East and Africa chief investment officer at BlackRock Fundamental Equities. 'The challenge for investors has been some of the names that we thought had greater brand strength, and it turned out they actually didn't,' she said, adding that there could be some buying opportunities after the selloff in the sector 'but you do need to be selective.' For the sector as a whole, the difference is stark between now and the 2021 to 2023 boom times, when investors were rushing to snap up any European luxury shares as they reaped the profits from shoppers on a post-pandemic spending spree. But with China's sluggish economy putting a dent into demand for pricey handbags and watches, investors are buying shares in the brands that can captivate consumers and selling the ones that can't. Among this year's winners, shares in Burberry have surged more than 30%. The UK fashion brand is gaining traction with its turnaround plan and winning new customers through its outwear push. To some investors, luxury valuations are still too high overall even after this year's plunge in a number of stocks. The industry has an average forward price-earnings ratio of 27, according to data compiled by Bloomberg. That's a near 85% premium to the broader market and above the long-term premium from the past 10 years. 'This is a sector that is fully exposed to tariffs and fully exposed to the weaker dollar,' said Roland Kaloyan, head of European equity strategy at Societe Generale SA. 'It's going to be quite difficult, so I stick to my underweight.'
Fashion Network
5 days ago
- Business
- Fashion Network
Luxury's split between winners and losers is only getting wider
One striking example of the sector's divide is LVMH versus French peer Hermes International SCA. Sales at LVMH's key Fashion & Leather Goods division are expected to have dropped 7.8% in the second quarter, according to analyst estimates. The company reports after the bell on Thursday. Hermes, which has been an example of how companies can thrive on selling the highest-end items, is expected to report revenue growth of 12% at its leather goods division. Its results are due on July 30. In the case of the Louis Vuitton and Tiffany & Co. owner, the stock has lost roughly half of its value over the past two years, losing its crown of Europe's biggest stock, with investors increasingly worried about an unprecedented demand slump in China. Hermes shares, on the other hand, are weathering the broader industry pullback. After a 160% jump since the end of 2020, the stock is little changed this year versus a 7% drop in Goldman Sachs Group Inc.'s basket of luxury shares. In the current economic context, pricing power is critical, said Helen Jewell, Europe, Middle East and Africa chief investment officer at BlackRock Fundamental Equities. 'The challenge for investors has been some of the names that we thought had greater brand strength, and it turned out they actually didn't,' she said, adding that there could be some buying opportunities after the selloff in the sector 'but you do need to be selective.' For the sector as a whole, the difference is stark between now and the 2021 to 2023 boom times, when investors were rushing to snap up any European luxury shares as they reaped the profits from shoppers on a post-pandemic spending spree. But with China's sluggish economy putting a dent into demand for pricey handbags and watches, investors are buying shares in the brands that can captivate consumers and selling the ones that can't. Among this year's winners, shares in Burberry have surged more than 30%. The UK fashion brand is gaining traction with its turnaround plan and winning new customers through its outwear push. To some investors, luxury valuations are still too high overall even after this year's plunge in a number of stocks. The industry has an average forward price-earnings ratio of 27, according to data compiled by Bloomberg. That's a near 85% premium to the broader market and above the long-term premium from the past 10 years. 'This is a sector that is fully exposed to tariffs and fully exposed to the weaker dollar,' said Roland Kaloyan, head of European equity strategy at Societe Generale SA. 'It's going to be quite difficult, so I stick to my underweight.'
