August Surge: Guess, VF, and Capri Propel Fashion Stocks to New Heights

Fashion finally ends its streak of falls on the international stock markets. In August, the Modaes Global Fashion Benchmark (MGFB35) broke a six-month downward trend. The selective, which measures the evolution of the capitalization of the 35 most representative listed companies in the fashion sector worldwide, closed last Friday at 29,307 points, 4.1% more than in the previous month, after having lost 18.1% of its value between January and July.

Up to 27 of the 35 stocks included in the selective closed August in positive territory, although the leadership of U.S. fashion stands out, which accounted for the six most significant rises of the month on the trading floor. The biggest rise corresponded to Guess, with a 35% rise on the stock market, followed by 29.8% for VF Corporation and 21.1% for Capri, the parent company of Michael Kors.

Three other U.S. fashion icons, PVH, Gap and Levi Strauss, followed with stock market gains of 18.2%, 16.9% and 16.3%. Outside the U.S., stocks such as the British JD Sports, up 13.7%, Italy’s Prada (listed on the Hong Kong Stock Exchange), up 12.9%, Chile’s Falabella, up 11.9%, and China’s Chow Tai Fook, up 10.3%, also rose by double digits in August.

Together with Prada, the French conglomerate LVMH led the increases in the luxury sector, with a stock market rise of 9.2%, compared to 6% for Kering and 4.8% for Richemont. On the other hand, in large-scale distribution, results were mixed: compared to the large increase in the value of Gap, Sweden’s H&M rose by 8.2%, Spain’s Inditex by 2.6% and Japan’s Fast Retailing (Uniqlo’s parent company) did not manage to do so and saw its shares fall by 0.8%.

Asos, Boohoo and Zalando, three ecommerce groups, led the falls in August

In sports fashion, fortunes were also uneven among the different operators: compared to the rise of JD Sports and Anta, whose shares increased by 7.1%, the U.S. group Nike managed a rise of only 3.7%, while Germany’s Adidas recorded one of the seven falls of the month on the SIMB35, with a 0.7% drop in value.

In the segment where there has been a unison evolution is in the online segment, which led the declines in August. The British Asos and Boohoo (the latter now Debenhams Group) led the declines in the month with devaluations of 9.2% and 8.6%. They were followed by German ecommerce group Zalando, down 5.1%.

The recovery of the SIMB35 took place against a backdrop of recovery on the international trading floors during the summer month. In the case of Spain, the country’s benchmark Ibex35 rose by 5.7% in August, while the U.S. Dow Jones rose by 4.5% in the same period.

On the other hand, currency exchange rates weighed on the performance of the SIMB35, which measures the evolution of the capitalization in euros of the 35 companies that make up the selective index. At constant exchange rates, the SIMB35 would have risen by 4.25%, to 29,352 points.

Updated monthly by Modaes, the SIMB35 is the result of multiplying the previous month’s value by dividing the sum of the current month’s market capitalizations in euros of the 35 companies that make up the selective by the sum of the previous month’s capitalizations, taking into account a corrective factor in the event of changes in the number of shares. The SIMB35 was launched in September 2011, with a trading base of 10,000 points.