STOCKS NEWS EUROPE-Kering sinks after posting profit drop
Shares of Kering fall 3.5 percent, the biggest losers on the CAC 40, after the owner of the Yves Saint Laurent, Bottega Veneta and Gucci brands reports a steep drop in full-year profits, with sales growth at Gucci almost grounding to a halt.
"This confirms the trade idea that a lot of people have been playing recently: buy exposure to Europe, buy exposure to the U.S., and avoid exposure to emerging markets," a Paris-based trader says.
Luxury shares - seen as safe-havens for fund managers during the heat of the euro zone debt crisis in the past years - have fallen out of favour in the past few months, hurt by their strong exposure to emerging markets.
Louis Vuitton owner LVMH derives 38 percent of its sales from emerging markets, 35 percent for Kering, and 39 percent for smaller rival Dior , according to data from MSCI.
Burberry has a 33 percent exposure to emerging markets, and luxury watch maker Richemont's exposure is 48 percent, according to the data.
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