Stocks of luxury goods tank due to ongoing Hong Kong protests.
Hong Kong: The protest since early June, many of which have ended in violent clashes between police and demonstrators have severely affected luxury stocks like Tiffany & Co., Movado Group Inc., Estee Lauder Cos., and many other North American luxury goods stocks. Hong Kong has been an extensively large market for expensive goods. But the protest which has continued from past 10 weekends has heavily disrupted the market.
On an average, there has been a fall of 30% in American luxury goods since April 2019, from the initial level of protest. To put the severity of the drop in perspective, the S&P 500 Index has registered a drop of about 1.6% over the same period of time. Stock market also struggled as the fire of US-China trade war burns on. On Monday, August 12, Bloomberg North America Luxury Goods Index (BIUSLGCP) fell as much as 3.6%, declining from Friday’s drop which was 3.7%.
Top decliners among the Index were Capri Holdings Ltd, Fossil Group Inc., and Tapestry Inc. Signet Jewellers Ltd, which is not part of the Index, also plummeted by 12%. Stocks of luxury goods witnessed a drop in bourses across London, Paris, Copenhagen, Frankfurt and Zurich.