With corporate results just one week ahead and the
negotiations to reach new free trade international agreements worldwide, stocks are struggling to maintain their quotes. Given this scenario, the FashionUnited Top 100 went down on Wednesday by 12.28, closing at 1197.34.
In Europe, few days after Hermes, sold a stake to the Louis Vuitton group, the Dumas family’s company is showing off the first aftermaths of the operation as the Parisian label lost yesterday 8.22%. While LVMH, which is in turn world’s largest luxury goods company by sales, keeps on increasing its market’s position, Hermés is falling since the acquisition announcement was made public.
LVMH acquired 17.1 per cent of Hermès International, or what it is the same, the luxury group has bought 15m Hermès shares equivalent to a 14.2 per cent stake. It also holds derivatives, which when converted will give it an additional 2.9 per cent, as reported by the Financial Times.
Industry experts praised the move, in which LVMH paid less than half the market price for the shares due to the use of derivatives, cementing its reputation as the world’s leading luxury goods group. This movement has arisen some expectations among not only the financial community but the fashion one, shaking the stocks of other competitors as the Swiss Richemont, which caught LVMH’s wealth wave and scratched 0.22%, when Christian Dior fell by 0.68%.
Crossing the Pond, Filipino communities in the United States are lobbying for support for the passage of a bill that will effectively strengthen the country’s garment industry. While the US Congress is currently in recess for midterm elections, sessions will resume Nov. 16 and continue until mid-December. The US Bill is part of President Barrack Obama’s stimulus package in support of efforts to achieve economic recovery in a time when most of American quoted companies are experiencing difficulties to avoid extra losses in their daily trades.
Neighboring Canada is also lingering doubts on their new free trade agreement with EU. Manufacturing industry fears that the agreement would deal another blow to Canada’s already battered manufacturing sector, wiping out thousands of jobs in food processing, apparel making and the auto industry, according to an analysis of a potential agreement released today.
Finally, unusual high volume detected on shares of Jones Apparel Group, Inc. (NYSE:JNY), early in the trading session. Jones Apparel was later trading lower by 23.26%, so definitely the sellers in control, as the stock's volume is already above average. For those interested in the multibrand company, their stocks were underperforming the overall USA market after presenting their quarterly profit yesterday, which missed the expectative. Net income attributable to Jones was $29.1 million or $0.34 per share, compared with $30.4 million or $0.36 per share in the year-ago quarter. The third-quarter results included costs and charges of approximately $11 million, or $7 million after tax, related to the acquisitions of shoe seller Stuart Weitzman and fashion brand Robert Rodriguez.