Pete Wargent blogspot

Co-founder & CEO of AllenWargent property buyer's agents, offices in Brisbane (Riverside) & Sydney (Martin Place), & CEO of WargentAdvisory (providing subscription analysis, reports & services to institutional clients).

5 x finance/investment author - 'Get a Financial Grip: a simple plan for financial freedom’ (2012) rated Top 10 finance books by Money Magazine & Dymocks.

"Unfortunately so much commentary is self-serving or sensationalist. Pete Wargent shines through with his clear, sober & dispassionate analysis of the housing market, which is so valuable. Pete drills into the facts & unlocks the details that others gloss over in their rush to get a headline. On housing Pete is a must read, must follow - he's one of the finest property analysts in Australia" - Stephen Koukoulas, MD of Market Economics, former Senior Economics Adviser to Prime Minister Gillard.

"Pete is one of Australia's brightest financial minds - a must-follow for articulate, accurate & in-depth analysis." - David Scutt, Business Insider, leading Australian market analyst.

"I've been investing for over 40 years & read nearly every investment book ever written, yet I still learned new concepts in his books. Pete Wargent is one of Australia's finest young financial commentators." - Michael Yardney, Australia's leading property expert, Amazon #1 best-selling author.

"The most knowledgeable person on Aussie real estate markets - Pete's work is great, loads of good data & charts, the most comprehensive analyst I follow in Australia. If you follow Australia, follow Pete Wargent" - Jonathan Tepper, Variant Perception, Global Macroeconomic Research, author of the New York Times bestsellers 'End Game' & 'Code Red'.

"The level of detail in Pete's work is superlative across all of Australia's housing markets" - Grant Williams, co-founder RealVision - where world class experts share their thoughts on economics & finance - author of Things That Make You Go Hmmm, one of the world's most popular & widely-read financial publications.

"Wargent is a bald-faced realty foghorn" - David Llewellyn-Smith, 'MacroBusiness'.

Sunday, 4 September 2016

Retail flat again (far out!)

Retail flat

Seasonal adjustments for department store sales have delivered a bit of a wild ride in recent years, and this month's Retail Trade figures recorded a monster -6.2 per cent decline for the sector in July.

It's not the first time we've seen a 'far out' reading for department store retail (last time the figures snapped back the following month) - but we'll have to wait until next month to see whether that happens again.

In any event, this contributed a flat result in seasonally adjusted terms, for just a +0.1 per cent increase in trend terms.

Excluding the department stores reading retail turnover would have been up by +0.4 per cent for the month, so we'll have to wait and see what next month brings. 

Year-on-year retail turnover growth has sagged over the past year to just +2.7 per cent, to now sit well below the half decade average.

State versus state

The powerhouse states New South Wales (-0.2 per cent) and Victoria (-0.5 per cent) unusually both recorded negative results in July, possibly because department stores have their head offices in Sydney and Melbourne, though nobody really seems to know if that's why.

The only decent monthly results were seen in Queensland and South Australia.

Over the past year the opening of a new IKEA in Canberra was the spark to create the strongest retail turnover growth in the Australian Capital Territory (ACT), while the southern states have fared relatively well over the year to July.

This month's surprise negative result knocked the quarterly and annual figures for NSW and Victoria quite hard.

Note how demand in the the resources rich Northern Territory has fallen away in tandem with Western Australia, where iron ore and LNG construction projects have recently transitioned to production.

Department stores crunched

Erm, and then there's this. Maybe everyone stopped shopping for a month and there's a rebound pending, or perhaps the timing of revenues being booked is a bit of a lottery.

Leaving aside the department stores outlier, it's become clear that the household goods boom that piggy-backed off rising house prices as now ended. 

Food retail turnover was also weak in dollar terms, in part reflective of soft food prices and intensified competition from low cost supermarkets such as Aldi.

The best performing sector of the year has been clothing and footwear.

The wrap

A rubbish result! We won't know until next month whether department store retail turnover was an anomaly, but it was an inauspicious start to Q3 for retail trade!