China’s thirst for luxury goods has grown in recent decades. However, sales are starting to drop as China’s economy also falters. While regulators of the second largest economy in the world claim it’s still expanding, growth has slowed. And this is being reflected in luxury brand sales.
Burberry group said yesterday that it has adjusted its yearly sales profits predictions. The final figure will be towards the lower end of estimates. This outlook has already driven Burberry’s market value down by US $2.04 billion.
Other luxury brands are also seeing a drop in their market share value. Prada, Ralph Lauren and LVMH all reported a 4% drop in their share prices after Burberry sounded the alarm. Between China’s economy, the Eurozone crisis and the 2008 banking fiasco, luxury brands are feeling the pinch.
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