Burberry shares fall as spread of coronavirus spooks investors
Shares in luxury goods giant Burberry have fallen a further six per cent this morning as the spread of coronavirus in Europe spooked investors.
The British brand has seen its share price drop in recent weeks as the virus took hold in China, one of Burberry’s major markets. Earlier this month Burberry was forced to close around 24 of its 64 stores in China as footfall plunged 80 per cent.
Investor confidence has been knocked again this morning on reports that coronavirus cases have spiked in Italy, sparking concerns that the virus will spread further within Europe.
The number of confirmed cases within Italy has soared from three on Friday to 152 this morning, and the country’s coronavirus death toll currently stands at four.
The spread of the outbreak has increased fears that it could become a pandemic. The FTSE 100 fell more than three per cent this morning.
CMC Markets analyst David Madden said: “Italy is at the centre of the coronavirus crisis in Europe but the China situation is still bubbling away. Luxury brands such as Burberry, Remy Cointreau plus LVMH are in the red given the company’s exposure to China.”
Paris-listed LVMH and Remy Cointreau suffered share price drops of five per cent and 4.05 per cent respectively this morning.
“Fears over an escalation of the coronavirus outside of China have caused a major retreat in global markets and prompted wild swings in commodity prices.,” Russ Mould, investment director at AJ Bell, said.
“Italy’s lockdown, as the country tries to control the worst outbreak of the virus in Europe, has caused investors to panic about how business and society will be affected. A large spike in coronavirus cases in South Korea has also added to market concerns.”