Latest news with #retailsales
Bloomberg
2 hours ago
- Business
- Bloomberg
FTSE 100 Live: UK Stocks Set for Worst Week Since April
After rising this morning, the FTSE 100 ended the day in the red, as it rounds off its worst week since April. Still, Unite made a late gain after Goldman Sachs analysts said the British student accommodation provider was set to benefit from Trump's attempts to curb immigration, which are deterring international students away from the US. But the FTSE 250, while having slightly pared its earlier advances, ended the day higher and little changed on the week. That's despite this morning's worse-than-expected drop in retail sales, with volumes falling the most since 2023. In better news for the Treasury, the UK budget deficit came in smaller than estimated in May. Other data painted a mixed picture of Britons' personal perceptions of the economy and their finances. The pound outperformed most of its G-10 peers, though sits around flat now, hovering around the midpoint between $1.34 and $1.35. Gilt yields ended the day broadly little changed. Have a great weekend.
Yahoo
5 hours ago
- Automotive
- Yahoo
'Grisly' May retail sales drop of 1.1% could point to Bank of Canada restarting rate cuts
Retail sales for May likely contracted 1.1 per cent after increasing 0.3 per cent in April on strong automobile sales, Statistics Canada said on Friday. The April result just missed analysts estimates of a 0.4 per cent month-over-month increase, but core sales, which exclude gasoline and vehicles, only rose 0.1 per cent. In March, retail sales grew 0.9 per cent. Feedback in April indicated that 36 per cent of retailers felt the impacts from the United States' tariff war against Canada. Increases in prices, changes in demand and supply chain problems were among the major issues cited. 'Despite six of nine subsectors posting monthly gains in retail sales, all nine subsectors saw a negative impact on sales,' Statistics Canada said. Here's what economists think the numbers mean for the economy and Bank of Canada interest rates. 'A decline in the May advance estimate for retail sales provides another indication that the economy is heading for a stall in Q2,' Andrew Grantham, an economist at CIBC Capital Markets, said in a note. Much of the previous strength in retail sales was due to automobiles, sales of which were 13 per cent higher than a year ago. Grantham said a similar scenario played out in the U.S., with vehicle sales subsequently fading. He said 'sluggish' sales when autos are excluded 'is evidence that consumer spending is starting to struggle.' CIBC is calling for the Bank of Canada to restart interest rate cuts and forecasting two more trims of 25 basis points this year to take rates to 2.25 per cent. 'The grisly flash estimate for May suggests the economy will slow over the second half of the year,' Bradley Saunders, North America economist at Capital Economics Ltd., said in a note. He said it's possible the drop could reflect a pullback by consumers who flocked to purchase vehicles to get ahead of tariffs. But he also said a recent uptick in consumer confidence 'suggests the final figure may not be quite as bad.' However, Capital Economics still thinks annualized economic growth is on track to contract one per cent for the remainder of the year, leaving the Bank of Canada in a pickle because some businesses reported prices are rising just as growth appears to be on the brink of slowing. Bank of Canada governor Tiff Macklem earlier this week warned that prices would start to tick up unless tariffs are eased. 'Yet despite Macklem's hawkish comments, we still believe policymakers will prioritize the downside risks to the economy and therefore expect more loosening this year than is currently priced into markets,' Saunders said. May's forecasted retail sales decline points to two things: a weakening consumer and slower growth in the second quarter, Charles St-Arnaud, chief economist at credit union Alberta Central, said. Still, he thinks there are signs that consumers are not in that bad of shape. For example, retail sales per person, adjusted for inflation, improved in April, indicating that increasing consumption no longer depends solely on population growth. That, along with improving consumer sentiment, means 'further deterioration in consumer spending is less likely.' St-Arnaud doesn't think the latest retail numbers will sway the Bank of Canada's decision on interest rates and that inflation is more important to policymakers. He thinks the Bank of Canada will focus its attention on next week's consumer price index to guide its next rate decision on July 30. 'It was better to look at core sales to get a better idea of the health of Canadian consumers,' Daren King, an economist at National Bank of Canada, said in a note, highlighting that sales fell in several categories, including clothing, shoes, building materials and garden supplies. Looking at May, he said it's possible that wildfires across much of Western Canada could corral sales. 'We are not seeing inflation in our business,' Empire CEO says 'This is massive:' Amazon extends Prime Day to four days and encourages shoppers to support Canadian brands Regardless, National Bank's 'base case' is for retail sales to continue slowing over the next few months, given the tariff uncertainty and a stalling jobs market. 'The (federal) tax cut announced this summer will certainly soften the blow, but it should not be forgotten that some mortgage holders continue to face an interest payment shock,' he said. • Email: gmvsuhanic@ Sign in to access your portfolio
The Independent
6 hours ago
- Business
- The Independent
Weak retail sales and falls in key oil and drug stocks stifle FTSE 100
London's FTSE 100 faded into the close on Friday, ending lower, as weak retail sales data and falls in heavyweight oil and drug stocks offset hopes for progress in the Israel- Iran conflict. The FTSE 100 index closed down 17.15 points, 0.2%, at 8,774.65. It had earlier traded as high as 8,847.28. The FTSE 250 ended 74.51 points higher, 0.4%, at 21,148.50, and the AIM All-Share rose 0.95 of a point, 0.1%, at 759.14. For the week, the FTSE 100 closed down 0.9%, the FTSE 250 ended down 0.1% and the AIM All-Share ended down 0.6%. In European equities on Friday, the CAC 40 in Paris closed up 0.3%, and the DAX 40 in Frankfurt ended 1.3% higher. On Wall Street, markets were mixed at the time of the London close on Friday. The Dow Jones Industrial Average was up 0.3%, the S&P 500 was down 0.1% and the Nasdaq Composite was 0.4% lower. The yield on the US 10-year Treasury was quoted at 4.40%, stretched from 4.39%. The yield on the US 30-year Treasury was quoted at 4.91%, widened from 4.89%. Hopes grew on Friday that diplomatic progress could be made towards dialling down the tensions in the Middle East. French president Emmanuel Macron said France and other European powers would make an offer to Iran of a comprehensive diplomatic solution to end the escalating conflict with Israel, AFP reported. French foreign minister Jean-Noel Barrot will meet Iranian counterpart Abbas Araghchi in Geneva 'to make a complete diplomatic and technical offer for negotiations,' Mr Macron told reporters, adding that France and allies Germany and the UK were 'putting a diplomatic solution on the table'. 'Iran must show that it is willing to join the platform for negotiations we are putting on the table,' Mr Macron said. The developments came after US president Donald Trump said he will decide on potential US action against Iran within two weeks. 'Based on the fact that there's a substantial chance of negotiations that may or may not take place with Iran in the near future, I will make my decision whether or not to go within the next two weeks,' Mr Trump said in a dictated message, according to White House spokeswoman Karoline Leavitt. Stephen Innes, at SPI Asset Management, said Mr Trump's two-week 'thinking window' on whether to join Israel's war against Iran is 'no cooling-off period – it's a ticking volatility clock'. Ipek Ozkardeskaya, at Swissquote Bank, agreed, stating: 'I'm not sure the US buying itself time can be interpreted as a sign of de-escalation.' Brent oil traded lower at 76.49 US dollars a barrel late on Friday from 78.59 dollars on Thursday. The downward correction saw BP fall 2.0% and Shell drop 0.7%. Also weighing on London's blue-chip index, a drop in drugs firms GSK and AstraZeneca, which ended 2.2% and 1.3% lower. Earlier this week, Mr Trump renewed his threats of tariffs on the sector. Also in the UK, investors weighed a sharp drop in retail sales and assessed public sector borrowing figures. Data from the Office for National Statistics showed UK retail sales fell 2.7% in May from April. This was against a 1.3% rise in April from March and worse than the 0.5% decrease expected by FXStreet-cited market consensus. On an annual basis, retail sales decreased by 1.3% in May, compared with market consensus for a 1.7% increase. Rob Wood, at Pantheon Macroeconomics, said while May's month-to-month fall puts a halt to the rapid rise in retail sales volumes over the start of the year, the underlying upward trend of consumer spending growth will resume in June. He noted surveys show that households have rebuilt their 'rainy day savings and are comfortable with their level of assets. We think this will provide a secure floor for consumer spending.' But Callum McLaren-Stewart, at Citi, thinks the figures constitute 'compelling evidence' of a turn in consumer demand and increases the likelihood of an August interest rate cut. Retail share prices were mostly lower. B&M fell 3.3%, JD Sports fell 0.6%, Next fell 0.2% and Marks & Spencer were down 0.7%. Separate figures from the ONS showed UK Government borrowing, last month, jumped to the highest level for May outside the pandemic era despite a boost to the tax take after the chancellor's national insurance hike. Borrowing surged to £17.69 billion last month, the second highest figure on record for May, surpassed only at the height of Covid, from £16.12 billion a year prior. On-month net borrowing slimmed from £20.05 billion. Borrowing for the first two months of the financial year to date was £37.7 billion, £1.6 billion more than the same two-month period in 2024. Lloyds Bank analysts noted the figure was actually £3 billion below what the Office for Budget Responsibility expected at this point. 'It isn't all good news for the Government though. On a cash basis (central government net cash requirement), the Government has had a requirement of £39.9 billion over April and May and that is £7.4 billion more than the OBR benchmark at this stage,' Lloyds added. The pound was quoted up at 1.3467 US dollars at the time of the London equities close on Friday, compared to 1.3429 dollars on Thursday. The euro stood higher at 1.1521 dollars against 1.1468 dollars. Against the yen, the dollar was trading at 145.89 yen, up compared to 145.65 yen. On the FTSE 100, Berkeley Group fell 8.2% as profit guidance fell short of hopes. The housebuilder expects pretax profit of £450 million for its new financial year. Profit in the following year is 'likely to be similar'. The Cobham, England-based company posted pretax profit of £528.9 million for the financial year ended April 30, down 5.1% from £557.3 million the prior year. Revenue edged up to £2.49 billion from £2.46 billion. 'In terms of guidance, the group is now pointing to PBT (profit before tax) of £450 million in FY26, and a similar level in FY27. We suspect that tougher trading, and increased sales incentives are at the heart of this (guidance),' analysts at Peel Hunt commented. 'Currently, we forecast £475 million and £482 million, implying we need to cut our forecasts by 5-6%.' United Utilities fell 1.7% as RBC Capital Markets downgraded to 'sector perform' from 'outperform' after Thursday's capital markets day. Mulberry fell 11% after announcing a £20 million fundraise and plans to cut costs by £5.9 million as part of a restructuring. The Somerset, England-based, luxury handbag maker said it needed further capital to fund its growth strategy in 'light of an even more challenging trading environment'. Gold was quoted lower at 3,366.36 US dollars an ounce against 3,368.94 dollars. The biggest risers on the FTSE 100 were: Melrose Industries, up 17.9 pence at 517.2p; Standard Chartered, up 26.0p at 1,178.5p; Schroders, up 5.4p at 364.4p; Rentokil, up 5.0p at 350.0p; and Prudential, up 12.0p at 894.2p. The biggest fallers on the FTSE 100 were: Berkeley Group, down 340.0p at 3,810.0p; GSK, down 32.5p at 1,402.5p; BP, down 8.25p at 384.7p; Intertek, down 88.0p at 4,646.0p; and United Utilities, down 19.5p, at 1,124.0p. Monday's global economic calendar has flash composite PMI readings in the UK, eurozone and US plus US existing homes data. There are no significant domestic corporate events scheduled on Monday. Later in the week, Bunzl releases a trading statement and Babcock International reports full-year results.
Reuters
9 hours ago
- Automotive
- Reuters
Canada's retail sales up in April, likely to post big drop in May
OTTAWA, June 20 (Reuters) - Canada's retail sales were up in April on a monthly basis but were below estimates, data showed on Friday, as the momentum seen in the previous months when customers advanced purchases to beat the impact of tariffs continued. Retail sales in April grew by 0.3% to C$70.11 billion ($51.11 billion) from 0.8% observed in the month earlier, Statistics Canada said, adding sales grew in six of the nine subsectors. An advanced estimate of sales shows that the number is likely to contract by 1.1% in May. "Canadian consumers continued to spend in April, but a decline in the May advance estimate for retail sales provides another indication that the economy is heading for a stall in Q2," Andrew Grantham, senior economist at CIBC Capital Markets wrote in a note. Retail sales are closely watched by economists and analysts as they give an indication of the trend of the GDP. They had been largely increasing in the previous months as uncertainty around the timing and magnitude of tariffs brought forward purchases. The sales have started showing signs of decline as tariffs have come into effect and analysts expect that they are likely to go down in the coming months. Feedback from respondents for April highlighted the effects of trade tensions between Canada and the United States on Canadian retail businesses, the statistics agency said. "Despite six of nine subsectors posting monthly gains in retail sales, all nine subsectors saw a negative impact on sales," it said. Analysts polled by Reuters had estimated the April sales to increase by 0.5% on a monthly basis and 0.2% excluding automotive and parts sales. StatsCan reported that excluding automotive and parts sales, the number shrank by 0.3% from a drop of 0.8% in March. The biggest jump in sales in April came from sales at motor vehicle and parts dealers, registering a growth of 1.9%, and was led by sales at new car dealers and used car dealers. This is the biggest category of sales and contributes over a quarter of total retail sales. The biggest drop in sales came from gasoline stations and fuel vendors which shrank by 2.7% and were closely followed by sales at retailers selling clothing and accessories posting a drop of 2.2%. In volume terms, retail sales increased 0.5% in April. ($1 = 1.3718 Canadian dollars)
CBC
9 hours ago
- Automotive
- CBC
Retail sales inched up in April from sales gains at car dealers, but likely dropped in May
Retail sales rose 0.3 per cent to $70.1 billion in April, helped by gains in sales at new and used car dealers, says Statistics Canada. However, the agency says its preliminary figures for May point to a drop of 1.1 per cent for that month. For April, six of nine sub-sectors were up, as sales at motor vehicle and parts dealers gained 1.9 per cent, boosted by a 2.9 per cent increase at new car dealers and a 2.1 per cent rise at used car dealers. Sales at sporting goods, hobby, musical instrument, book and miscellaneous retailers rose one per cent, while furniture, home furnishings, electronics and appliances retailers gained 0.8 per cent. Sales at clothing, clothing accessories, shoes, jewelry, luggage and leather goods retailers fell 2.2 per cent. Core retail sales, which exclude gasoline stations and fuel vendors and motor vehicle and parts dealers, gained 0.1 per cent in April. In volume terms, overall retail sales rose 0.5 per cent in April.
