High street sales in August have suffered their biggest slump since the depth of the financial crisis in 2008.
BDO’s August’s High Street Sales Tracker recorded a further month of decline, with sales falling by 4.3% compared to the same month last year - the worst performance since November 2008.
The figure also represents the fourth consecutive month in succession of negative like for likes, which is the first time May to September have all been negative since 2009.
BDO said consumers deserted the high street in favour of spending on holidays abroad, with Gatwick Airport reporting its busiest ever August bank holiday weekend.
The strength of the pound is also proving “somewhat detrimental” to high street retailers’ revenues as consumers are spending more on items abroad to take advantage of the exchange rate, whilst tourists – particularly from the eurozone – are less willing to spend.
The continuing political and macroeconomic uncertainty, coupled with the threat of an interest rate rise in mid-2016, is also weighing on consumers’ minds, BDO said.
We’re still awaiting any news from Conviviality Retail over its bid for wholesaler Matthew Clark on what is the deadline for its bid today.
Waitrose weekly sales for the week to 29 August were up 1.8% (ex petrol), meaning sales have now risen by 2.2% in the first four weeks of its financial second half. Parent John Lewis Group will announced its first half results next week.
The FTSE has opened lower this morning, falling 1% to 6,129.6pts in early trading as investors show caution ahead of US jobs data released today.
Most stocks have edged downwards, notably the tobacco firms, with Imperial Tobacco (IMT) and British American Tobacco (BATS) both down 1.4% already this morning to 3,140p and 3,402p respectively. Coca-Cola HBC (CCH) has also been hit in early trading, dropping 1.9% to 1,301p.
Yesterday in the City
Once more the FTSE 100 is having a better end to the week than the start, having recovered by another 1.6% yesterday back up to 6177.6pts.
One of the FTSE’s top risers was Morrisons (MRW), which leapt 4.7% to 170.8p on rumours that South African retail magnate Christo Wiese was pondering a bid for the chain after reports he was eyeing up the UK food retail market.
McColl’s Retail Group (MCLS) edged up 0.5% to 157p despite reporting a 2.3% drop in third quarter like-for-like sales.
Booker (BOK) slipped back 1.6% to 176.2p after approval of its deal to buy Londis and Budgens as investors cashed in their profits at the end of the day after Booker hit its highest ever share price of 184.7p during morning trading.