Fund managers snap up luxury brands on coronavirus dip
Leading fund managers are buying millions of pounds of shares in luxury brands after significant falls triggered by the coronavirus outbreak.
Fund manager Nick Train, along with bosses from Rathbone Brothers, Jupiter and BNY Mellon, are taking advantage of the dip according to the Sunday Times.
Train, who manages the Lindsell Train UK Equity fund, has bought more shares in Burberry, which has fallen 11 per cent in recent weeks, Remy Cointreau and Diageo.
Jelena Sokolova, equity research analyst at Morningstar, told the Sunday Times that the impact of the coronavirus on luxury goods is likely to be “severe but essentially short term” so the sector could bounce back once the virus fears have subsided.
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Chinese citizens account for 35 per cent of all luxury purchases made around the world but a number of stores have closed to curb the spread of infection.
Chinese authorities are trying to encourage people to return to work as they try to balance containment of the virus and supporting a struggling economy.
President Xi Jinping said on Sunday that China will maintain a prudent monetary policy and roll out new policies to help small firms, according to Reuters reports.
He said that the coronavirus outbreak will have a relatively big hit on the economy.
The Shanghai Composite Index has fallen by 11 per cent since the start of the year but it is now down just 1.5 per cent.
South Korea’s coronavirus spike
South Korea declared a red alert on Sunday after reporting 123 new coronavirus cases and a fifth death from the virus.
More than half of the 602 confirmed cases are linked to a church in the southeastern city of Daegu after a woman known as “Patient 31” tested positive last week. The woman had no recent record of overseas travel.
The escalation in the alert level enables the government to forcibly prevent public activities and order the temporary closure of schools.
Samsung has shut down a factory after a worker tested positive but operations are due to resume on Monday morning.
The Chinese authorities have confirmed 76,936 cases with the death toll rising to 2,442.
World Health Organisation chief Dr Tedros Adhanom Ghebreyesus has said the spread outside of China without a clear link is “very concerning”.