Richemont boosts European stock markets

LONDON - European shares rose on Thursday, helped by gains in major luxury goods stocks such as Richemont and LVMH, while a surge in telecoms group BT also helped markets recover from losses the day before.

The FTSEurofirst 300 index rose 0.6 percent to 1,102.50 points by around midday, while the euro zone's blue-chip Euro STOXX 50 index also rose 0.5 percent to 2,517.12 points.

Trading volumes, however, were thin due to public holidays in France, Italy, Spain and parts of Germany.

Swiss group Richemont advanced by 5.5 percent after Bank of America Merrill Lynch raised its rating on the stock to "buy" from "underperform".

The increase in Richemont's share price also lifted rival LVMH, which rose 3.2 percent, and those two stocks contributed to some of the biggest points gains on the FTSEurofirst 300 index.

Central Markets senior trader Joe Neighbour said he had followed the general positive investor sentiment towards European equities by buying Germany's DAX equity index, which was up 0.6 percent at 7,304.50 points, at 7,265 points.

However, he was more cautious on the luxury goods sector, since the industry is heavily reliant on consumer demand in China, which has shown signs of a slowdown in growth.

"The luxury goods companies have had a very good run, but if China does start to feel the pinch, then they may find it hard to repeat that performance over the next 12 months," he said.