LVMH stock gains 1.9% as Arnault pushes trade deal to avoid U.S. tariffs

Highlights

- LVMH stock is trading at €484.05, up 1.9%, but remains over 30% below its 52-week high.

- CEO Bernard Arnault is lobbying for a U.S.–EU trade deal to prevent steep tariffs on fashion and leather goods.

- Short-term price action is likely to stay within a €450–550 range, driven by geopolitical developments and earnings trends.

While the short-term uptick suggests some investor optimism, the broader technical picture remains bearish. LVMH stock has lost over 30% year-on-year and remains significantly below its 52-week high of €762. The current price action places the stock in the lower third of its 12-month range, underscoring continued pressure on sentiment. From a technical analysis standpoint, key support levels sit around €440, which has repeatedly held during selloffs.

A break below that zone could trigger a retest of the €430 level seen in late June. Resistance is found at €520, aligned with both the 50-day moving average and previous consolidation zones from earlier this year. The 200-day moving average remains above €600, with a continued downward slope that confirms the prevailing long-term bearish trend. Trading volumes remain moderate, but recent price stabilization suggests LVMH could be entering a consolidation phase.

LVMH stock price dynamics (May 2025 - July 2025). Source: TradingView

Momentum indicators are mixed. The Relative Strength Index (RSI) has moved back above 45, hinting at a neutral to slightly bullish bias in the very short term. However, the MACD remains negative and flat, reflecting a lack of strong directional conviction. If shares break above €500 in early August and sustain that move, it could trigger a short-covering rally toward €540. Otherwise, continued failure at the €490–500 zone could result in further consolidation or downside pressure.

Tariffs, trade diplomacy, and weak earnings weigh on sentiment

LVMH’s technical outlook is being shaped not just by charts but by mounting political and macroeconomic risks. On July 30, CEO Bernard Arnault publicly called for a formal U.S.–EU trade deal, labeling it “necessary but not perfect.” He warned that without an agreement, retaliatory tariffs—particularly on fashion and leather goods—could severely impair the luxury sector. The U.S. has proposed duties as high as 20% on European fashion products, while Switzerland faces potential tariffs of over 30% on watches. LVMH earns more than a quarter of its revenue from the U.S., so trade friction poses a material earnings risk.

Despite headwinds, the company reported Q2 2025 revenue of €19.5 billion, down 4% year-over-year. The fashion and leather division, traditionally its growth engine, contracted by 9%. This marked the weakest performance in over three years. CFO Cécile Cabanis indicated that while the group can absorb a 15% tariff, it would have a "non-trivial impact" on U.S. margins. Moët Hennessy is under pressure as well, reportedly burning through €1.5 billion in 2024 alone. Arnault, meanwhile, has signaled an intent to expand U.S. manufacturing capacity, including a second Texas factory scheduled for 2027. He also extended his personal leadership horizon to age 85, aiming to stabilize investor expectations during a difficult transition period.

Wide range outlook driven by trade outcomes

Given this complex backdrop, price projections for LVMH must incorporate both technical levels and geopolitical catalysts. In a base-case scenario where the EU and U.S. agree to a 15% tariff ceiling and LVMH communicates further mitigation strategies, the stock could retest the €520–540 range by the fourth quarter. This would represent a 7–11% upside from current levels. A bull case involving full exemption for luxury goods could accelerate gains toward €600, especially if U.S. consumer data improves in tandem.

However, if negotiations stall or tariffs go into full effect, shares could quickly fall back to the €440–450 support zone. A break below that level would open up the possibility of lows near €420, last seen during the 2022 post-pandemic correction. Until more clarity emerges on the trade front, we expect LVMH to trade in a wide range between €450 and €550, with news-driven volatility continuing to dominate price action.

LVMH reported flat Q1 2025 revenue at €20.3 billion, showing resilience despite slowing global luxury demand. However, the Wines & Spirits division struggled, burning €1.5 billion in 2024 due to aggressive acquisitions and pricing errors, prompting a leadership change in early 2025.

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