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Let's take a look at some of the stocks on the move today in Europe. I'm James will Caught with Stephen Carroll and we're joined by Bloomberg Reports at Chloe Mery Chloe. Let's start with Burbury News out this morning. How is the market reacting.
Well, there's been actually quite a lot of weakness today for Birbury, despite having better than expected sales. But it seems that investors actually wanted more and that the beat was perhaps not good enough to match those very high expectations that we had going into those earnings, and so
Burbery also had quite a fairly fairly cautious outlook. It said that the geopolitical and economic uncertainty as a result of the war in Iran may actually hurt shopper confidence going forward, and of course that echoes what we've heard from the luxury sector throughout this earning season, with LVMH Caring and even MS, which is traditionally a lot more resilient. All of those companies are saying that they had felt the impact of the war in Iran.
And so the turnaround for Barbary is technically working.
We've seen very solid growth in the US in China, which of course had two very important markets for the luxury sector. But the key worry here for investors is that the turnaround is still quite fragile in that the conflict might actually derail what has been quite a steady recovery up until now, and so that's why.
We're seeing some of that weakness this morning for Birbary.
We'll turn into the retail space next and a plunge in shares for three I. This is to do with its holding at the discount retailer Action.
Yeah.
So three A is a private equity firm and so as you've mentioned, the largest investment of that three I has is Action, and so this is a company that can be found all over Europe.
It sells things like a low.
Cost DIY tools, toiletries, things like that, and Action represents more than seventy percent of the portfolio value for three EYES. So the performance there is very very important, and unfortunately the performance wasn't that good. So there was a sales growth of about two percent year to date, which is less than half of the pace that we had a year ago.
And there was particular weakness.
In France and in Germany, and essentially the weakness in France is seemingly spread to Germany since the start of the crisis in the Middle East. So it seems to point to the fact that even really low cost retailers, very affordable retailers, are struggling in this very difficult consumer environment. We've seen a lot of those retailers worn about the impact.
We had a dune Elm cut its guidance recently. Of course, clothing retailers like H and M a warning of price pressures going forward, and it seems that even very cheap goods like the ones that action cells are not getting sold. And so we're seeing a huge drop for three I this morning on the back of that.
And finally earnings to Telefonica, what is the latest.
Yeah, it's good, pretty good day for Telephonica.
Slight increase in first quarter earnings and that was boosted by two things in particular, so really good performance in Brazil, which is a very important market for Telephonica, and also a less competitive environment in Spain, and so that's really big boost for the company. That is about six months into its strategic plan and it is still working on winning over investors after that strategic plan that it announced a few months ago included cutting the dividend and also
cutting free cash flow projections. And so now investors are really turning towards tending their attention towards any sign that Telephonica might be seeking to do large deals as part of the chairman's ambitions to consolidate markets.
Where the company is operating.
And so we have those good earnings in this potential for M and A that is driving those shares.
This morning the Stock Mover's Report from Bloomberg Radio. Check back with us throughout for the latest roundup of companies making news on Wall Street and for the latest market moving headlines. Listen to Bloomberg Radio Live, catch us on YouTube, Bloomberg dot com, and on Applecarplay and Android Auto with the Bloomberg Business app.