Already a subscriber?Consumers are increasingly bullish and banking on tax cuts and higher property values to buoy their finances – optimism which did little to stop a slide in retail stocks as investors took in weaker-than-expected sales so far this year.
But a major survey conducted by Barrenjoey Capital Partners suggests that the worst may have passed for retailers, with the analysis showing more consumers expect their financial outlook to improve rather than deteriorate – the first time the study of more than 1000 people has recorded this result since April last year.
The wealth effect will have a large influence on the mood of Australian shoppers, Barrenjoey’s survey found, as will income tax cuts which start on July 1. JB Hi-Fi chief executive Terry Smart said it was a “challenging and competitive retail market”, with same-store sales in Australia falling 0.3 per cent in the three months to March 31 compared to the same period last year.
Chris Stott, chief investment officer at 1851 Capital, said retail stocks were “already getting sold off on fears of rate hikes from the RBA stoking a further slowdown”.