Tuesday, October 30 08:54:04
The ISEQ is ahead this morning at 3,256, up 28 points as corporate results in Europe lift sentiment. Friday's retail sales data is examined by NCB Stockbrokers:
Irish retail sales data released on Friday by the CSO show that headline retail sales volumes rose 0.9pc mom in September, representing a third successive monthly increase (August +0.4pc, July +1.2pc). September was the first time in 9 months where headline retail sales volumes were in positive territory (+1.4pc) on a yoy basis. Core retail sales, which exclude the volatile motor trade component, rose 0.6pc mom in September (versus no change in August and +1.2pc mom in July).
Analysis: While the recent performance has been encouraging, year-to-date retail sales volumes remain in negative territory (headline -3.3pc, core -1.2pc). Within the different segments of the retail sector we see mixed trends during September. Bars had a bumper month, with volumes +4.5pc mom, while Department Stores experienced a 2.6pc mom increase.
At the other end of the spectrum we see further evidence that motorists are adjusting to higher fuel costs, as fuel volumes were 6.1pc below year-earlier levels in September while the value of fuel sales is +3.1pc over the same period.
Conclusion & Action: In all, Friday's release points to a healthy Q3 performance after the weakness seen earlier in the year. However, with further tax increases and spending cuts due to be unveiled in December's budget, our sense is that the near-term outlook for the retail sector is somewhat challenging according to NCB Stockbrokers.