Gucci and Volvo Cars shares were hammered on Friday as oil and AI spending worries rattled global markets. Kering, the French luxury group behind Gucci, shed more than 16%. Volvo Cars plunged more than 24%.
This report covers European names, not Bursa Malaysia counters. Still, the oil move reached ringgit terms fast, with Brent at RM476.63 a barrel.
Why Did Gucci and Volvo Cars Shares Fall on Friday?
Brent crude for December rose more than 3% to US$116.72 (RM476.63) a barrel, its highest since late April. The benchmark US contract, West Texas Intermediate, jumped 3.8% to US$103.27 (RM421.70).
AJ Bell’s head of financial analysis Danni Hewson said markets were contending with “concerns around surging oil prices and the sustainability of AI spending.”
Kering’s results failed to reassure investors about a turnaround at its key Gucci brand. Investors also sold Volvo Cars after its latest quarterly report.
What Is Volvo Cars’ RM2.1 Billion Savings Plan?
Volvo Cars said US tariffs and strong competition from local brands in China pushed it into a third-quarter loss. Its answer is a new five-billion-kronor (RM2.1 billion) savings plan.
- About 2,000 job cuts in Sweden
- About 500 more job cuts globally
The plan targets costs at a carmaker already reporting a loss, so the savings will be closely tracked in coming quarters.
How Did Wall Street and Asian Indices Close?
- Dow Jones: down 1.2% at 52,215.16 (close)
- S&P 500: down 0.5% at 7,623.68 (close)
- Nasdaq Composite: down 0.2% at 25,955.34 (close)
- FTSE 100: down 0.3% at 10,690.36
- DAX: down 0.8% at 25,181.65
- Nikkei 225: down 0.3% at 62,693.16 (close)
- Hang Seng Index: up 0.7% at 23,093.37 (close)
- Shanghai Composite: up 0.9% at 3,690.48 (close)
Chris Beauchamp, chief market analyst at IG, said “everyone appears to be rotating back into the stuff they rotated out of yesterday.” He added that “no one wants to be caught holding risk over the weekend.”
Why Are AI Spending Worries Hitting Markets?
Joseph Zidle, chief market strategist at Cresset Capital, said “people are now looking at the cap ex as a liability and that’s different from six months ago.” Investors are now more leery of massively expensive capital spending on data centres.
Technology stocks clawed back some of the week’s hefty losses in Asia. For a Malaysian lens on AI names, see AI Stock Analysis for Malaysians.
Which Events Could Move Markets Next?
Investors are focused on interest-rate meetings by the US Federal Reserve and the European Central Bank. An update on US economic growth data is also due, alongside next week’s earnings.
Key Takeaways
- Kering shed more than 16% after results failed to reassure investors on its Gucci turnaround.
- Volvo Cars plunged more than 24% after a third-quarter loss blamed on US tariffs and Chinese competition.
- Volvo’s five-billion-kronor (RM2.1 billion) plan targets about 2,000 Swedish and 500 global job cuts.
- Brent at US$116.72 (RM476.63) and AI spending doubts drove the sell-off.
Disclaimer: This article is for general information only and is not investment advice. Figures are taken from the source report on Friday’s trading. Do your own research before making any investment decision, and consider speaking to a licensed adviser.
Frequently Asked Questions
Why did Volvo Cars shares fall more than 24%?
Volvo Cars plunged more than 24% after it said US tariffs and strong competition from local brands in China pushed it into a third-quarter loss. It responded with a five-billion-kronor (RM2.1 billion) savings plan.
How much did Kering shares fall on October 24?
Kering, Gucci’s parent, shed more than 16% on Friday, October 24. Its results failed to reassure investors about a turnaround at the Gucci brand.
How many jobs will Volvo Cars cut under its savings plan?
Volvo Cars said its plan would lead to about 2,000 job cuts in Sweden and 500 more globally. The savings target is five billion kronor (RM2.1 billion).
How high did Brent crude oil go on October 24?
Brent crude for December rose more than 3% to US$116.72 (RM476.63) a barrel. That was its highest level since late April.
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Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always do your own research before making investment decisions.
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