London has recaptured its crown as Europe’s largest stock market from Paris, lifted by surging crude oil prices.
“The UK has held up better due to its sector mix,” said Janet Mui, head of market analysis at RBC Brewin Dolphin, “The energy sector is a low-duration play which can hedge against more interest rate or inflation-sensitive secular growth exposure,” she added. The picture contrasts with Paris, which is under pressure from China’s economic slowdown. LVMH, L’Oreal SA, Hermes International and Kering SA between them comprise almost a fifth of the CAC 40 index, and drove the rally earlier this year. All have slid from the highs hit earlier this year, as analysts warn that demand for posh handbags and jewelry is likely to slow in China, as well as at home in Europe.