For the first time since 2017! Luxury demand is sluggish, and LVMH falls out of the top ten by market value in Europe.

LVMH is about to lose its crown as France's most valuable company and drop out of Europe's top ten listed companies by market value a landmark reversal for the luxury giant that led the European market during the post-pandemic boom. The stock fell 2.5% on Tuesday, reducing its market value to 201 billion ($232 billion), slipping below L'Oral. The move marks the first time since 2017 that LVMH has fallen out of Europe's top ten by market value. "Those who claim Europe is back are wrong, Europe is not back: what LVMH is telling us is that its main growth engine luxury has stalled," said Vincent Juvyns, chief investment strategist at ING in Brussels. LVMH was Europe's most valuable company when it peaked in 2023, with its share price surpassing 900, and has since fallen about 55%. Demand for luxury goods continues to weaken in its crucial Chinese market, while recent Middle East conflicts have hit consumption at several key shopping malls. To make matters worse, Louis Vuitton, LVMH's most profitable brand, recently faced a consumer boycott in China over a trademark dispute with Molly Tea, further deepening its woes in the country. Several brokerages have downgraded the stock's rating and target price. The luxury group, controlled by billionaire Bernard Arnault, has seen its stock plunge about 37% this year alone, returning to levels seen during the pandemic when many countries were in lockdown and a large number of stores worldwide were closed. The scale of this pullback is already comparable to the decline during the global financial crisis. According to the Bloomberg Billionaires Index, Arnault fell out of the world's top ten richest people last week, leaving the list dominated entirely by American billionaires, mostly from the tech industry.