Tepid China data, Richemont pull down European shares

The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, July 13, 2023. REUTERS/Staff/File photo

European shares fell on Monday as China’s lackluster economic data knocked down commodity-linked stocks, while luxury group Richemont slumped on weaker-than-expected organic sales growth.

The pan-European STOXX 600 index was down 0.5 percent by 0706 GMT. The benchmark index posted gains of nearly 3 percent in the previous week, driven by hopes that the U.S. Federal Reserve could wind up its interest rate hikes soon.

Data on Monday signaled China’s economy grew at a frail pace in the second quarter on weaker demand, leading to a fall in commodity prices, which dragged miners and energy firms down 1.6 percent and 0.8 percent, respectively.

READ:  China’s Q2 GDP growth slows to 0.8% q/q, raises stimulus expectations

Shares of Richemont dropped nearly 7 percent after the world’s second-biggest luxury firm reported a 19-percent rise in its quarterly organic sales, but fell short of analysts’ estimates.

Shares of other China-exposed luxury firms such as LVMH, Hermes and Kering slumped between 2 percent and 2.7 percent.

READ: As travel resumes, China’s luxury shoppers ask: Paris or Hainan?