Shares in Hennes & Mauritz HMb.ST fall 1.3 percent after JP Morgan initiates coverage on the stock with an "underweight" rating, saying the fashion retailer's prospects for growth from the internet are not as strong as some of its rivals.
“Input cost inflation, a maturing sales base and less internet opportunity,” provide the rationale for JPMorgan’s negative stance on H&M in a note.
In contrast, it starts Inditex ITX.MC with an "overweight" rating, citing growth prospects in Asia/Russia, low relative exposure to inflationary input costs and nascent internet exposure.
Inditex falls 1.8 percent.
Next and Debenhams fall 0.5 and 0.1 percent, respectively.
Reuters Messaging rm:// email@example.com
Reuters Breakingviews is the world's leading source of agenda-setting financial insight. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day. A global team of about 30 correspondents in New York, London, Hong Kong and other major cities provides expert analysis in real time.
Sign up for a free trial of our full service at https://www.breakingviews.com/trial and follow us on Twitter @Breakingviews and at www.breakingviews.com. All opinions expressed are those of the authors.