PARIS (Reuters) - Luxury goods companies Hermes and Richemont won promotion on Wednesday to the blue-chip Euro STOXX 50 equity index, which could increase investment funds' demand for the stocks that have hit all-time highs.
The index provider said Hermes and Richemont would formally enter the Euro STOXX 50 on Dec. 20.
Their promotion is likely to fuel further demand for their shares as funds that automatically track the index add them to their portfolio.
Universal Music Group (AS:UMG) and telecoms company Vodafone (LON:VOD) will drop out of the Euro STOXX 50 index.
The global luxury goods industry has benefited this year as shoppers returned to department stores that had been hit by COVID-19 pandemic lockdowns.
Shares in Hermes, which posted stronger-than-expected third-quarter sales in October, have risen by nearly 90% in 2021, hitting record highs.
Richemont, which is controlled by South African billionaire Johann Rupert, last month also posted stronger-than-forecast first half results, driving its share price to record highs.