LVMH strength pulls luxury fashion stocks across Europe

In London, Marks & Spencer and Next closed the session up, partially driven by N Brown’s stock jump after its first-half results came in better than expected.

As highlighted by Reuters, luxury fashion retailer Burberry was in the black, riding on the coat-tails of French peer LVMH, which rallied after its third-quarter sales beat analysts’ expectations. Burberry Group finished with an intra-day gain of 3.1 percent.

City analysts attributed the luxury fashion retailer's uptrend to the ripple effect caused by the strong earnings from French luxury goods firm LVMH Moet Hennessy Louis Vuitton.

LVHM reported a 4 percent increase in revenue to 26.3 billion euros over the first nine months of 2016. Organic revenue grew 5 percent compared to the same period in 2015. With organic revenue growth of 6 percent, the third quarter saw an acceleration compared to the first half of the year. Asia, excluding Japan, showed a significant improvement during the quarter.

As IG analyst Chris Beauchamp stressed, "Good numbers from luxury firm LVMH have helped Burberry to rise steadily this morning, with the stock touching its highest level since August 2015. At around 20 times forward earnings."

Meanwhile, N Brown’s shares gained 19 percent on Tuesday as the online and catalogue clothing retailer reported a profit dip in profit for its first half of the current financial year due to exceptional costs it booked. However, revenue rose as it increased online penetration and online sales.

The speciality womenswear chain said pretax profit in the 26 weeks ended August, 27 fell slightly to 21.1 million pounds, while revenue rose to 429.4 million pounds. N Brown will pay an interim dividend of 5.98 pence, which is flat year-on-year. N+1 Singer shared their contempt with the interim results released by N Brown, saying that business for the retailer at the start of the third-quarter was "reassuring".