Marketbites: LVMH Reports Sharp Sales Increase
MARKET PERFORMANCE:
Portfolio Manager Commentary:
Stocks jumped Thursday, with Big Tech leading, as traders cheered another report pointing to cooling U.S. inflation. Tech stocks outperformed, with both the communication services and information technology sectors among the notable gainers in the S&P 500. Mega-cap tech stocks advanced, with shares of Amazon, Google-parent Alphabet, and Meta each up more than 2%. Tesla shares also rose 2%.
“The market was a little poised to potentially go up on any positive news, and in this case, the PPI number was quite a bit better than expected. And I think that gives people some comfort that in fact the Fed probably doesn’t have to raise rates in the next meeting,” said Spouting Rock Asset Management’s Rhys Williams.
The March producer prices index (PPI), a measure of prices paid by companies and often a leading indicator of consumer inflation, declined by 0.5% month over month versus expectations for prices to be flat. Excluding food and energy, the core wholesale prices reading shed 0.1% month over month, much better than the 0.2% increase expected by economists polled by Dow Jones.
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LVMH reported a sharp rise in quarterly sales driven by a rebound in China and strong demand for its clothing, handbags, and jewelry in Europe and Japan. The figures are an early indication that high-end shoppers in China are once again boosting makers of luxury goods now that Beijing eased Covid-19 restrictions. Persistent disruption in China was a major headache in recent years for the luxury industry, which had come to rely on spending by Chinese shoppers at home and abroad over the past two decades. As seen below, Fashion and leather goods, the company’s largest division, booked an 18% rise in quarterly sales to €10.73 billion. The company said Louis Vuitton, its largest brand, had an excellent start to the year, while Dior “continued to perform remarkably well across all its products.”
Source: WSJ
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