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Retailers Curb Gulf Operations as Iran Conflict Widens, Luxury Shares Slide

Airspace closures following missile strikes have choked tourism, unsettling investors in a market that had powered recent luxury growth.

Overview

  • Kering shut stores in the UAE, Kuwait, Bahrain and Qatar and suspended corporate travel to the Middle East.
  • Chalhoub Group closed Bahrain outlets and kept other markets open with voluntary staffing, with executives checking on teams at Dubai’s top malls.
  • Apple stores in Dubai are closed until Thursday, H&M shuttered sites in Bahrain and Israel, and Reckitt ordered work-from-home, halted Middle East travel and temporarily closed its Bahrain plant.
  • Investors sold off luxury names, with LVMH, Kering and Burberry down about 10% week to date as of Tuesday and the Stoxx 600 nearly 3% lower, while Richemont also fell.
  • Thousands of flights were canceled with only limited services resuming, a missile strike damaged Dubai’s Fairmont Palm hotel, and a Kearney estimate flagged hundreds of millions of dollars in at-risk travel-retail sales if shutdowns last a month as Primark monitors its late-March Dubai debut.