LVMH shares rebound but remain threatened by economic slowdown and monetary tightening
LVMH (MC) stock has rebounded in recent days on the back of international rebounds after encouraging news from China and excessive pessimism. The luxury giant has rebounded nearly 10% from its May 10 low, returning near resistance at around €600.
However, this rebound may not last. The LVMH share could go back below this resistance and continue the underlying downward trend that began due to the economic slowdown and the tightening of central bank monetary policies.
Indeed, this environment is very negative for the markets, and even more so for expensive and cyclical stocks like LVMH. The economic slowdown affects cyclical stocks while the monetary tightening affects the most expensive stocks.
It is for these reasons that the cyclical sector (-21%) has underperformed the most on the Paris Stock Exchange since the start of the year, as well as on the New York Stock Exchange. This underperformance is expected to continue over the next few months as monetary tightening and the economic slowdown continue.
LVMH (MC) stock price daily chart – key levels