Why Luxury Retailers Are Losing Their Luster
Bling appears to not be as much of a thing. Luxury retailers, which were flying high as the wealthy thrived, are starting to look more like diamonds in a pretty rough spot. Threats to global stability — including terrorism, the United Kingdom’s withdrawal from the European Union and China’s slowdown — are rattling international shoppers of high-end goods. At the same time, luxury retailers are losing share to online sellers, an issue bedeviling mainstream chains. They’re also suffering at the hands of discounters and fast-fashion luxury lookalikes. Investors are taking note. The S&P Global Luxury Index, which tracks the value of the stock of dozens of companies that deal in luxury goods including automakers, has lost 15.06% in the past year, compared to a 2.58% rise in the S&P 500, an index of the 500 largest publicly traded companies. “If you’re tied to international consumers, you really have not had any sense of relief in the past several quarters,” says Simeon Siegel, equity research analyst with Nomura Securities. Read more at USA Today.
