News from China last week helped buoy markets, as they offered stimulus measures in various areas, including dropping mortgage rates. Over the weekend, the quiet optimism of these measures helped boost Asian markets into the beginning of the week. The FTSE 100 also opened on a positive note, with many hoping that the tough times of interest rate hikes and a crumbling Chinese economy could be nearing their end.
Oil has seen a rally in prices not seen since November last year, following news of the OPEC+ cuts to supply in oil. Last week, Russia announced that they would continue their export restrictions and many expect Saudi Arabia to follow suit. The oil price shot up to nearly $86 per barrel, which many concern central bankers who were eyeing slowing inflation.
The luxury sector, including big names like Louis Vuitton, Pernod Ricard and Burberry, enjoyed a boom in early 2023 as the market demand in China seemed to have ever growing potential. As China’s demand has crashed, and ongoing issues with inflation have started to finally stagnate markets in the US and Europe, the luxury sector is now eyeing the growing influence of the Indian market. With the French CAC 40 alone exposed by nearly 20% to the luxury sector, the power of handbags is not to be underestimated.
Sources: Bloomberg, AJ Bell, Nasdaq, Yahoo Finance