“RETAIL ACTIVITY MAY CONTRIBUTE ABOUT 60% TO GDP, BUT IN THE LAST YEAR RETAILERS HAVE FAILED TO BRING HOME THE BACON!”
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Retail activity is generally acknowledged as the best barometer for economic activity. However it must be over 2 years since we had any food or clothes inflation. So profit margins have continued to narrow for the retailers themselves and many of them have indulged themselves in a fierce and raging price war to increase or maintain market share – none more so than the supermarkets. The performance of the share prices from this sector posted above has been dispiriting at best. Sainsbury and Metro have JUST bucked the trend for the supermarkets but have hardly distinguished themselves. Tesco and Morrison remain in remission.
M&S’s performance has been abysmal. CEO Steve Rowe has still failed to grasp the nettle. M&S’S fashion range is dowdiness personified. Even H&M have found the going tough. Carrefour has suffered the slings and arrows of outrageous fortune and NEXT has been adversely affected by the hand of BREXIT fear, the falling Pound and a slight loss of confidence by the high Street in its range of clothes. AB Food’s share price has probably agonised from the performance of food rather than Primark that continues to acquit itself with aplomb. Even the fabulous internet sight of Ted Baker has felt vulnerable. Retailers’ performance has been pretty motley at best and the yellow jersey goes indisputably to Spain’s Inditex – the owner of the Zara brand! Ocado has been the most heavily ‘shorted’ UK retail stock, BUT it has recovered by about 12% in the last 3 months.