Stronger Christmas sales was good news for Morrisons this morning (see more below). However other recent retail results – think Debenhams, Mothercare etc – cast some deep shadows. The British Retail Consortium is pointing to a sharp downturn in festive 2017 spending: like-for-like sales were up just +0.6% in December compared to 2016’s +1% sales climb in the same month. A -40% fall-off. Also, sales of non-food was down -3.7% in the last quarter. A very steep drop.
It’s figures like these that point to the real state of UK consumer confidence and its impact on UK retailers, particularly weaker ones. And as the Brexit uncertainty continues and wages, in real terms, continue to fall, retail confidence can only worsen. Volatility will increase.
Overnight in Asia the New Year buying spree continued with all Asian markets seeing climbs, from Singapore (+0.42%) to Tokyo (+0.57%). It was a bit more muted in Hong Kong with the Hang Seng up +0.27% while the Shanghai Composite was up just +0.11%.
Japan’s Topix index ended +0.5% up – a 26-year high – while there was also better news on Japanese wages which were up in real terms in November though one economist speaking to the FT attributed this, in part, to increased overtime earnings as opposed to a more permanent change.
Overnight the pound was -0.01% down at 1.3562 while the dollar was -0.25% down against the yen at 112.77. Little change for the euro against the dollar at 1.1967.
- UK FTSE 100 7,696.51 -0.36%
- DAX 13,367.78 +0.36%
- CAC 40 5,487.42 +0.30%
- Dow 25,283.00 -0.05%
- S&P 500 2,747.71 +0.17%
- Nasdaq 7,157.39 +0.29%
- Nikkei 225 23,849.99 +0.57%
- Gold 1,319.00 -0.12%
- Oil WTI 62.15 +0.68%
Morrisons Premium range boosts Christmas sales
Morrisons appears to have managed the Christmas sales period effectively with sales up +2.8% for the ten weeks to 7 January – though this figure climbs to +3.7% over the Christmas and New Year period.
Sales of its ‘Best’ premium range were up +25% claims Morrisons while online sales were up +10%. "Our plans,” says boss David Potts, “to become a broader and stronger business are progressing well, with another period of positive like-for-like sales and the start of the rolling programme to supply McColl's."
Morrisons shares are up +3.1% in the last week but down more than -7% in the last six months at 226.50p. Over a five-year period they are down more than -10%.