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(Alliance News) - Retail sales in the UK partly rebounded in May from the record fall seen in April, the Office for National Statistics said Friday, with a third of all sales taking place online amid the continued closure of non-essential high street shops last month.
The volume of retail sales in May jumped 12% versus the previous month, when sales volume plunged 18%. In value terms, retail sales were 12% higher in May.
Market consensus, according to FXStreet, was for a 5.7% volume rise on April.
Despite May's strong rise, the ONS noted sales were still down 13% compared to February, before the coronavirus pandemic hit the UK.
"The monthly growth rate in May 2020 is strong because of a combination of recent increasingly rapid growth in non-store retailing and a pick-up for non-food stores from the lowest levels ever experienced," the ONS said.
Non-food stores provided the largest positive contribution to the monthly growth in May, the ONS said, aided by a strong increase of 42% in household goods stores, with the reopening of hardware, paints and glass stores during the month driving sales.
Food stores showed a slight monthly decline in volume of sales, falling 0.3% in May, but levels remain high from the spike in sales in March, partly caused by panic buying during the pandemic as reported by retailers, the ONS said.
Year-on-year, retail volumes were down 13% in May, while retail value was 14% lower.
"There has been a significant fall in the overall volume of sales in the retail industry since March 2020 as many stores paused trade from March 23 following official government guidance during the coronavirus pandemic. This has resulted in a fall of 13% in the three months to May 2020; the lowest levels since records began in 1996," the ONS said.
The proportion spent online soared to the highest on record in May at 33% of all sales. This compares with 31% in April.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: up 0.4% at 6,250.91
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Hang Seng: up 1.1% at 24,738.43
Nikkei 225: closed up 0.6% at 22,478.79
DJIA: closed down 39.51 points, 0.2%, at 26,080.10
S&P 500: closed up 0.1% at 3,115.34
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GBP: up at USD1.2455 (USD1.2421)
EUR: unchanged at USD1.1219 (USD1.1220)
Gold: up at USD1,732.40 per ounce (USD1,721.16)
Oil (Brent): up at USD42.13 a barrel (USD41.20)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Friday's Key Economic Events still to come
1000 CEST EU euro area balance of payments
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Germany's producer prices for industrial producers suffered in May, dragged down by energy prices, numbers from official statistics agency Destatis showed. Producer prices fell 2.2% annually in May, stretched from April's 1.9% year-on-year decline. Month-to-month, the decline slowed to 0.4% however, from April's 0.7% fall. The performance in May was slightly worse than forecast, consensus estimates, according to FXStreet, were for a 0.3% monthly decline and a 2.1% annual fall.
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BROKER RATING CHANGES
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GOLDMAN SACHS RESUMES FLUTTER ENTERTAINMENT WITH 'BUY' - TARGET 13200 PENCE
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JPMORGAN RAISES WILLIAM HILL TO 'OVERWEIGHT' ('NEUTRAL') - TARGET 200 (160) P
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BERENBERG CUTS DOMINO'S PIZZA TO 'SELL' ('HOLD') - TARGET 250 PENCE
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GOLDMAN SACHS INITIATES AVAST WITH 'BUY' - TARGET 600 PENCE
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COMPANIES - FTSE 100
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Rio Tinto launched a high-level review of its operations in Western Australia, after the miner blew up a 46,000-year-old Aboriginal heritage site to expand an iron ore mine. In announcing the move, Rio Tinto Chair Simon Thompson issued a formal apology to indigenous communities for the destruction on May 24 of ancient rock shelters in the Juukan Gorge in Western Australia's Pilbara region. "The decision to conduct a board-led review of events at Juukan Gorge reflects our determination to learn lessons from what happened and to make any necessary improvements to our heritage processes and governance," he said in a statement. He said the review will begin immediately and will work with the Pinikura & Puutu Kunti Kurrama Aboriginal communities who are the traditional owners of the region. It will issue a final report by October, the company said. Rio Tinto initially defended its blasting in the Juukan Gorge as authorised under a 2013 agreement with the state government.
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COMPANIES - FTSE 250
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John Wood Group said its like-for-like revenue in the first half was down 11% but noted it has secured USD1.3 billion of new orders in April and May. The oilfield services firm said it saw "relatively robust activity" in chemicals & downstream and in built environment markets. "Despite the disruption, we are continuing to successfully win and execute work, supported by our strategy of broadening the business across the global energy market & the built environment. The relative strength we are seeing in chemicals & downstream, the built environment and renewables, where we will double our revenues in 2020, is helping to mitigate the impact of challenging conditions in upstream and midstream oil & gas," Chief Executive Robin Watson commented.
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COMPANIES - MAIN MARKET AND AIM
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The UK competition regulator has decided to refer Studio Retail's Findel Education sale to a Phase 2 review unless undertakings are given. In December, the retail and education company had agreed to sell Findel Education to the Council of the City of Wakefield for GBP50 million on a debt and cash free basis. It said cash realised from the sale would be used to make a voluntary payment to the company's defined benefit pension fund with the remainder used to reduce debt. Studio Retail said that while it previously expected the sale to complete in April, the regulatory authority has experienced difficulty in compiling third-party views in relation to the disposal due to the Covid-19 outbreak. Elsewhere, Studio Retail said it has continued to trade strongly and well-ahead of the prior year, with product sales over the first eleven weeks of the new financial year up 55% against the year before. "This has been driven by particularly strong demand for ranges such as toys, games, electricals, fitness and garden," Studio Retail said.
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Currency manager Record said its financial 2020 performance was in line with internal expectations, noting its "resilient" performance allowed it to keep shareholder payouts in line with its dividend policy. For the year ended March 31, Record's pretax profit slipped to GBP7.7 million from GBP8.0 million the year before. Revenue, however, was up 2.4% to GBP25.6 million from GBP25.0 million. AuME ended March 31 at USD58.6 billion, up 2.3% on the year before, following USD4.6 billion of net inflows recorded during the year. Record declared a final dividend of 1.15 pence, giving the firm an unchanged total annual dividend of 2.30p. The company also declared a 0.41p special dividend, but this is lower than the 0.69p special payout the year before.
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COMPANIES - GLOBAL
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ING Group will promote Chief Risk Officer Steven van Rijswijk to chief executive officer, the Dutch bank said on Friday, after losing its current CEO to a Swiss peer. From July 1, van Rijswijk replaces Ralph Hamers as CEO and chair of the Amsterdam-based firm's executive board. Hamers was poached by UBS Group to take over as CEO there. He leaves ING at the end of June. Van Rijswijk joined ING's executive board back in 2017, having joined the company in 1995.
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Chemicals firm BASF said Kurt Bock has taken over as its new supervisory board chair. Bock, who will hold the role for a four-year term, takes over from Jurgen Hambrecht, whose departure was announced back in May 2019. Bock chaired BASF's executive board between 2011 and 2018 and was also formerly the company's chief financial officer.
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US delivery startup DoorDash raised USD400 million from investors in a financing round valuing the company at nearly USD16 billion. The funding round comes with DoorDash and other food delivery services taking on new importance for consumers sheltering in place due to the coronavirus pandemic. DoorDash is the leading restaurant delivery service in the US with some 44% market share in May, according to research firm Second Measure. The second largest with 23% is GrubHub, which agreed this month to be acquired for USD7.3 billion by Anglo-Dutch company Just Eat Takeaway.com, outbidding US-based Uber Technologies which had sought to boost its Uber Eats service.
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Friday's Shareholder Meetings
boohoo
Costain Group
John Wood Group
AA
Learning Technologies Group
Trinity Exploration
Power Metal Resources
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By Tom Waite; thomaslwaite@alliancenews.com
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