French luxury group Kering announced Monday that it had appointed Luca de Meo, who helped drive automaker Renault out of crisis, its new chief executive as it tries to turn around the fortunes at its struggling flagship brand Gucci.

PARIS—François-Henri Pinault, the billionaire heir who spent two decades transforming Kering into a luxury powerhouse, is stepping back as chief executive officer, hoping an auto-industry veteran can pull Gucci and Saint Laurent out of a slump.

After impressing with his turnaround of French automaker Renault, Luca De Meo is widely expected to be named as the new boss of Gucci owner and luxury powerhouse Kering.

Shares of Kering, the luxury-goods company behind Gucci, Yves Saint Laurent and other brands, rallied as much as 10% on Monday after reportedly luring Renault’s chief executive to run the company.

Reports of de Meo’s switch to Kering sent the luxury group’s shares up by nearly 12% on Monday, recording their biggest one-day percentage gain since November 2008.

LONDON (Reuters) -News of Renault Chief Executive Luca de Meo's decision to leave the French carmaker and subsequent reports of him being lined up to take charge at luxury goods group Kering has created a stir across their respective sectors. Here's some initial reaction from analysts.

Investors may well be pondering that question as they digest news that Luca de Meo, lifetime car executive and architect of Renault’s nifty turnaround, has quit to lead Gucci parent company Kering.  In theory,

European shares made cautious gains on Monday, with Gucci -owner Kering leading the pack following a leadership change. The news helped to break a five-day losing streak as investors pivot from the conflict in the Middle East. The pan-European STOXX 600 ended 0.4 per cent higher amid the developments.