DAX Price Forecast: Lifted as LVMH Soars to All-Time High With Sales Increase of 17%

Highlights

• European markets outperform S&P 500 on bullish streak.
• LVMH sales increase by 17%, shares reach all-time high.
• Luxury Stocks Boost European Markets

Overview

European stock markets closed higher on Thursday as investors analyzed key U.S. inflation data. The pan-European Stoxx 600 index gained 0.44% and has more than recouped last month’s declines with gains of 1.4% so far, outperforming the benchmark S&P 500 index on Wall Street.

Investors are capitalizing on the pricing discrepancy and purchasing cheaper European shares as the risk associated with holding them decreases.

The German DAX index has been on a bullish streak, rising for four consecutive trading days and settling at a new 52-week high of 15729.46, up 0.16%.

Meanwhile, luxury stocks, including Hermes, Richemont, and Kering, experienced substantial gains, with Hermes reaching a record high and jumping 3.2%.

Novo Nordisk also contributed to the STOXX 600’s boost in healthcare stocks, rising by 1.1% and hitting an all-time peak after the company raised its full-year results forecast.

LVMH Sales Soar 17%, Shares Reach All-Time High

LVMH had a robust Q1, generating €21 billion ($23.1 billion) in sales, representing a 17% increase from the previous year, according to a press release.

As a result, LVMH shares soared to an all-time high, climbing 5.7% and closing at 872.70 euros in early trade.

Flavio Cattaneo’s appointment as CEO of Italy’s largest utility, Enel, is limiting the STOXX 600’s gains. This is causing a 3.8% drop in the company’s shares.

UK Economy Flat in February, January Growth Revised Upwards

The Office for National Statistics reported that there was no growth in the UK’s economic output in February compared to the previous month.

Growth for January was revised upwards to 0.4% from the previous forecast of 0.3%, resulting in a total growth of 0.1% in the three months leading to February. Some analysts warn of the recession risk intensifying, which may put a damper on market gains.

The FTSE 100 rose 0.25%, driven by mining, housebuilding, and gambling sectors. Tesco’s profit prediction resulted in a 0.6% boost in shares. Strikes by public workers affected output, leading to the economy’s failure to grow as expected in February.

US Inflation Rate Shows Signs of Deceleration, Jobless Claims Rise

The Labor Department reported a decelerating inflation rate, with US prices increasing 0.1% in March and 5% from the previous year.

In addition, the rise in jobless claims suggests that the Federal Reserve may soon pause its rate hikes. On the other hand, Eurozone data revealed stronger than expected industrial output for February.

Recent US reports on consumer and producer prices raise hopes for more relaxed Fed interest rate hikes.

Sources with direct knowledge told Reuters that European Central Bank policymakers may increase interest rates by 25 basis points in May.

For a look at all of today’s economic events, check out our economic calendar.