Iran war wipes out $100 billion from luxury stocks

TL;DR

Major luxury stocks have declined by 15% or more since the start of the Iran war.
LVMH and Hermès shares have dropped roughly 16% and 20%, respectively, this month.
Ferrari, Bentley, and Maserati are among the high-end car companies halting deliveries to the Middle East.
The Middle East was the fastest-growing luxury market last year, with Dubai being the primary growth driver.
The luxury industry was anticipating a recovery in 2026 after two years of stagnant sales.
Investor sentiment in luxury is described as the most bearish in years due to geopolitical uncertainty.
Share price declines have erased approximately $100 billion in market capitalization from major luxury companies.
A potential 50% drop in Middle East sales in March could reduce quarterly growth by about 1 percentage point for many luxury companies.
Dubai's success is attributed to factors like no income taxes and a growing millionaire population, but its reputation for safety is shaken.
Around 60% of luxury spending in the UAE comes from tourists, and higher oil prices could also impact aspirational consumer spending.
Declining or flat stock markets could negatively affect the spending of wealthy consumers due to the wealth effect.

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