The luxury goods group Richemont has not been spared by the loss of momentum in global demand for luxury products. Sales posted by the company behind brands such as Cartier and Piaget stagnated in the first quarter of its financial year, which ended at the end of June, due in particular to a sharp decline in sales on the Asian market. During the period under review, revenues totalled 5.27 billion euros, down slightly by 1% year-on-year. Excluding currency effects, organic growth was down by 1%, the company indicated in a press release on Tuesday. The group's watchmaking sector, which includes brands such as Piaget, Vacheron Constantin and IWC, was particularly hard hit by the downturn. Sales dropped by 14% to 911 million euros. At constant exchange rates, the reduction amounts to 13%. The jewellery segment, led by Cartier, achieved sales of 3.66 billion euros, an increase of 2% (+4%, excluding exchange rate effects). Richemont gave no indication of profits.

The SMI lost 0.7 per cent to 12,280 points on Monday. Among the 20 SMI stocks, there were 15 losers and five winners. A total of 14.2 (previously: 13.99) million shares were traded. Market participants spoke of disappointing business figures with regard to Swatch. The share price slumped by 9.8 per cent. Sales fell by 14 per cent in the first half of the year, while profits more than tripled. The watch group cited weak business in China among its main factors. According to Jefferies, the first half of the year was worse than had been anticipated. This did not bode well for Richemont's annual report on Tuesday, especially as Burberry also disappointed in the luxury goods segment. Richemont fell by 4.2 per cent on Monday. Holcim rose by 0.8 per cent on no news and the defensive Roche by 1.5 per cent. Other defensive heavyweights such as Novartis (-1.0%) and Nestle (-1.6%) finished in negative territory.

Europe
European stocks traded lower on Monday after data showed Chinese gross domestic product growth slowed sharply in the second quarter and as investors reacted to the weekend's assassination attempt on Donald Trump. The Stoxx Europe 600 index fell 1% on Monday to 518.7 points. In Paris, the CAC 40 and SBF 120 lost 1.2% and 1.1% respectively. The DAX 40 was down 0.8% in Frankfurt and the FTSE 100 shed 0.9% in London. Shares of the major French luxury goods groups Hermès (-2.6%), LVMH (-2.7%) and Kering (-5.3%) lost ground, following the announcement of disappointing results and outlook by their rivals Burberry (-16.1% in London) and Swatch (-9.8% in Zurich). Banking group BNP Paribas (+0.5%) confirmed on Monday having signed a partnership agreement with Singapore-based fintech Ant International to develop cross-border payment solutions in Europe. The financial terms of the collaboration were not disclosed. French defence and space giants Airbus (-0.3%) and Thales (-0.6%) have begun discussions with a view to combining their space activities, financial website La Tribune reported on Monday, citing sources close to the matter.

United States
Major stock indexes rose alongside government-bond yields with the return of the “Trump trade” following Saturday’s attempted assassination of Donald Trump. Investors had plenty to process Monday, including the likelihood of a second Trump presidency, earnings from Wall Street giants Goldman Sachs and BlackRock, and public comments from Federal Reserve Chair Jerome Powell. Stock indexes pared some of their gains after Powell signalled that interest-rate cuts are coming but declined to say when. The Dow Jones Industrial Average added 0.5% to close at a record 40211.72, its first since May. The S&P 500 was up 0.3%, while the Nasdaq Composite was 0.4% higher. Meanwhile, shares of Trump Media & Technology, the parent company of Truth Social, jumped 31%, and bitcoin surged above $63,000. Trump has cast himself as a pro-cryptocurrency candidate and is due to speak at a crypto conference this month. Firearms stocks surged Monday following the shooting at the presidential rally over the weekend. Smith & Wesson, the only large listed firearms maker, rose 11%, while bullet maker Ammo gained 15%. Tesla shares extended a recent tear. Elon Musk’s electric-vehicle maker added 1.8%, and the shares are now up more than 40% over the past month. Musk has aligned himself with Trump recently, offering an endorsement of the former president after the shooting Saturday. Shares of Tesla have gained more than 40% over the past month. Second-quarter earnings season has now kicked off in earnest, with Goldman Sachs and BlackRock reporting Monday. Goldman’s profit soared from a year earlier with help from strong results in its Wall Street businesses. Its shares rose 2.6%. BlackRock shares declined modestly after it reported faster growth and a record $10.6 trillion in assets under management. Investors will have plenty to chew on the rest of the week with earnings from Morgan Stanley, Netflix and United Airlines, along with data on U.S. retail sales and housing starts and a rate decision from the European Central Bank.

Asia
Asian and Australian stock markets were little changed on Tuesday. In Tokyo, the Nikkei 225 index gained 0.3 per cent to 41,329 points after the holiday break on Monday. The Chinese stock exchanges fell by 0.2 per cent in Shanghai following the predominantly weak economic data from the previous day, while Hong Kong again lost more significantly, namely 1.4 per cent. Among individual stocks, Ping An Insurance fell by a hefty 3 per cent in Shanghai and by over 5 per cent in Hong Kong. In Seoul, South Korea, defence stocks are still in demand. Hanwha Aerospace climbed 3.4 per cent. Rio Tinto dropped by over 2 per cent in Sydney. The share price of iron ore producer Fortescue is little changed, while the share price of Rio Tinto's major competitor BHP slipped 1.5 per cent. Champion Iron declined by over 2 per cent.

Bonds
Long-dated U.S. government debt yields sold off Monday, sending their corresponding yields higher, as traders weighed rising chances of a November victory for presumptive Republican presidential nominee Donald Trump following a weekend assassination attempt. The 10-year Treasury note yield rose by 4 basis points to 4.227%. The 2-year Treasury note on the other hand fell by less than a basis point to 4.451%.

Analysis
Deutsche Bank upgrades Partners Group to CHF 1,230 (1,150) - Hold
Rating Glencore: Barclays raises to Overweight (Equal Weight) - Target GBP 5.50
Rating Ascom: UBS downgrades to Neutral (Buy) - Target CHF 8 (11)

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