The sad state of luxury

Combine the European crisis and a slowdown in China and you have a recipe for a smaller market for luxury goods. rodeo_drive More window shopping on Rodeo Drive. FORTUNE - For the past two years, sales of bags, Dior perfumes and Louis Vuitton including one of the few bright spots in retail. But the dynamic in the world of all that is luxury began to sink some, as evidence builds that the consumers are resistant may not be able to the consequences of the crisis in the prevention of Europe continues to be debt with a slower growing China's economy together. On Wednesday, British luxury fashion house Burberry Group Plc luxury goods stocks led after reporting lower sales, missed analysts' expectations. Sales in the first quarter rose 11% to $ 634 million, below expectations for a gain of 13%. The results were not considered nearly catastrophic, and a Burberry executive said the company continues to see "a huge amount of opportunities" in China, he did not just make it easier to "nervous markets. Some analysts and investors are concerned that this is only the beginning of a slowdown in sales of premium. Burberry results came the same day Cartier, among the luxury watch and jewelry brand of Compagnie Financiere Richemont SA, said he sees less of an appetite for its high-end watches in China, an important factor behind the recent boom in luxury watches. "After a phenomenal year in the last year there was a bit of a downturn in the People's Republic of China," said Cartier CEO Bernard Fornas, the company plant Wednesday unveiled it's latest innovation, a concept clock called ID Two, the less energy consumed. Burberry, Fornas is not about the Chinese consumer in the long term worries. "When you are talking to people, they all wait for a new president to come," he added. "That the economy with new money and interest rates will stimulate lower." But it remains to be seen. In the years following the Great Recession, the demand for all the luxury things in the U.S. in tandem with gains in the stock market. For those who could afford it, was chic and extravagance not quite impossible, as rallies in the equity markets, affluent consumers more confidence in spending. But that was not enough to keep the appetite for the finer things in life, that luxury sales have slowed down in general in recent months. In May, MasterCard Advisors SpendingPulse reported that sales of luxury, without jewelry, rose by 1.8% in April compared to last year, after gaining 6.7% in the first quarter and 13% in the fourth quarter. While spending on luxury has recently met with some, says Michael McNamara, vice president of SpendingPulse, following credit card, cash and check operations, strong sales in 2011 is seen to be difficult to repeat this year. Upscale jewlers were particularly at risk. In May, Tiffany & Co. (TIF) in the fiscal year reduced revenue and earnings guidance after reporting weaker than expected first quarter results. This was followed by several factors, including concerns about the layoffs on Wall Street and cooling demand from Asia, an important contribution to the global luxury market motivated. David Schick, managing director of Stifel Financial, said he expected more tender feelings of luxury will be conducted around the world that economic growth in Asia and Europe slow. "This will undermine the confidence of consumers with higher incomes," he said. Downturn in the economy of China has been pressure on retail sales in Hong Kong, where many of the stretched state in the Chinese mainland in the lines down in order to purchase more blocks for luxury brands. Revenue rose 8.8% in May compared with the previous year to $ 4.6 billion, the smallest gain since September 2009. A diamond may be forever, but the application because it has a lifetime much less certain. Correction: An earlier version incorrectly stated this story is that the Burberry sales for the first quarter of 11% to 634 billion. It's $ 634 million.