CAC 40 Drifts Lower As Luxury Stocks Drop After LVMH Reports Drop In Earnings

French stocks are down in negative territory Wednesday morning, weighed down by losses in the luxury sector as industry major LVMH’s fourt-quarter revenue fell short of expectations.

Gains in technology sector help limit market’s downside.

Investors are looking ahead to the Federal Reserve’s monetary policy announcement due later in the day. The Fed is widely expected to hold rates unchanged, and the focus is on the accompanying statement for clues about future rate moves.

The European Central Bank is scheduled to announce its policy on Thursday. The ECB is expected to announce a 25-basis point rate cut.

The benchmark CAC 40, which dropped to 7,849.14 earlier this morning, was down 23.32 points or 0.3% at 7,875.05 a few minutes ago.

LVMH is down more than 6%. LVMH reported that its 2024 net profit was 12.550 billion euros, down 17% from 15.174 billion euros last year. Profit from recurring operations was 19.571 billion euros, a drop of 14%.

For 2024, revenue was 84.683 billion euros, down 2% from 86.153 billion euros. Organic growth for the year was 1%.

The company said it reported organic growth despite a challenging economic and geopolitical environment and a high basis of comparison following several years of exceptional post-Covid growth.

Kering is declining 6.1% and L’Oreal is down 2.6%, while Hermes International is down with a modest loss of about 0.5%.

STMIcroElectronics, Edenred, Pernod Ricard, ArcelorMittal, AXA and BNP Paribas are lower by 0.6 to 1.3%.

Schneider Electric, which posted sharpl losses in the previous two sessions, is up 5.1% this morning. Legrand is gaining 2.75%, while Unibail Rodamco and Essilor are up 1.5% and 1.2%, respectively.