L'Oréal surpasses LVMH in the Stoxx Europe Luxury 10. The luxury benchmark index has published the most valuable companies on the French stock exchange and the French conglomerate LVMH cedes its title to L'Oréal.
This fact proves that high-end luxury companies continue to suffer pressure after seeing their income and sales fall in recent fiscal years due to inflation and the armed conflicts that dominate the current political landscape.
Reuters points out that it is the first time since 2017 that a company not dedicated to the luxury sector has occupied the top spot on the Paris Stock Exchange at the close of a trading day.
Another relevant piece of data highlighted by elEconomista.es is that within the CAC 40 (France's main stock market index that measures the performance of the country's 40 largest and most liquid companies), the firms whose value is plummeting the most are French luxury brands such as EssilorLuxottica, Hermès, and LVMH, by between 35% and 45%.
It has been exactly a decade since L'Oréal traded above LVMH again, and both used to trade with a similar market value.
Bernard Arnault, CEO and chairman of the LVMH group, has also felt this decline: this week he left the group of the world's 10 richest billionaires tracked by the Bloomberg index, after losing more than 56,000 million euros since January and becoming the biggest fall among the 500 largest fortunes globally.
However, as elEconomista points out in the same article, this trend does not affect the premium makeup segment because its consumption is more frequent and less costly compared to luxury firms whose main activity focuses on textiles.
In addition to armed conflicts and inflation, this decline is also attributed to China. China has been a major market that is now opting for self-sufficiency thanks to strong development.