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Kering shares slump as Gucci shows signs of slowdown

Kering shares slump as Gucci shows signs of slowdown
FILE PHOTO: A view shows an advertising poster for the new high end jewellery Gucci store on Place Vendome in Paris, France, July 2, 2019. REUTERS/Regis Duvignau -
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REGIS DUVIGNAU(Reuters)
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PARIS (Reuters) – Kering’s shares <PRTP.PA> slumped on Friday as analysts honed in on signs of a slowdown at the French luxury group’s Gucci brand to knock down the stock from record highs reached earlier this year.

Kering shares were down 7.6% in early session trading, although the stock – which hit a record high in April – remains up around 14% so far in 2019.

Kering’s results late on Thursday showed a slower-than-expected rise in second-quarter sales at Gucci.

“Gucci’s slowdown in the USA exacerbated from 5% in the first quarter of 2019 to -2% in the second quarter,” wrote analysts at brokerage Bernstein.

“With this in mind, we expect the market will continue to wonder about the future ‘soft landing’ of Gucci, despite a very healthy margin improvement in the first half of 2019,” added Bernstein.

(Reporting by Sudip Kar-Gupta; Editing by Leigh Thomas)

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