0941 GMT - Expectations of a recovery in the luxury sector this year have turned out to be premature, analysts at UBS say in a note. The war in Iran, slower industry self-help measures and soft demand over the summer have further delayed the recovery, they say. While the slowdown seems to be cyclical rather than structural, consumers remain under pressure globally amid ongoing geopolitical uncertainty, the bank says. "We believe stock selection remains critical, as the pace of recovery is likely to vary significantly across brands and business models," the analysts say. UBS remains positive on hard luxury, high-priced and timeless goods such as watches and jewelry, favoring Richemont and Watches of Switzerland Group. Conversely, UBS downgrades Hermes's stock to sell from neutral as its earnings profile is becoming more cyclical.
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