Investing.com -- Shares in European luxury groups sank in mid-morning trading on Tuesday after analysts were disappointed that Chinese officials stopped short of announcing a raft of new fiscal stimulus measures.
At a press conference, the chair of China's National Development and Reform Commission -- the country's state economic planner -- said officials have "full confidence" that the world's second-largest economy will achieve its roughly 5% growth target this year.
But the NDRC did not reveal fresh fiscal stimulus plans to go along with a slew of support policies unveiled last month, underwhelming investors.
The tepid reaction was felt in stocks in China, capping big gains notched after markets reopened following the Golden Week holiday.
Luxury stocks in Europe -- including Louis Vuitton-owner LVMH (EPA:LVMH), Gucci-parent Kering (EPA:PRTP), British fashion house Burberry (LON:BRBY) and leather goods specialist Hermès (EPA:HRMS) -- dropped.
High-end item makers are exposed to shifts in the outlook for China's economy because the country accounts for much of their business. Analysts at Bain have estimated that Chinese luxury consumption will eventually reach 35%-40% of the world's total, Reuters reported.
European stocks in other China-exposed sectors like mining and automobiles also dropped.
In September, Chinese officials unveiled a sweeping package of new policies, including an outsized cut to interest rates and a reduction in existing mortgage costs.
Meanwhile, the People's Bank of China announced a swap program with an initial size of 500 billion yuan designed to give funds, insurers and brokers easier access to funding needed to purchase stocks. The PBOC also said it would provide up to 300 billion yuan in cheap loans to commercial banks in a bid to help them fund share purchases and buybacks by listed companies.
Chinese stocks rallied after the announcement. On Sept. 30, the last trading day before the Oct. 1 - Oct. 7 holidays, equities in the country surged to their biggest single-day uptick in 16 years.
(Reuters contributed reporting.)