Sector movers: Slowdown in Kingfisher sales renews concerns around consumers

Retailers were among the worst performing sectors on Wednesday as investors digested a slowdown in Kingfisher's like-for-like sales.

Annual results from retailer Kingfisher beat the City's profit forecasts thanks to strong growth from its Screwfix chain, but while the transformation of B&Q and French businesses continued, sales began to slow in the second half amid concerns of a broader consumer slowdown.

So, while UK & Ireland LFL sales in constant currencies were up 3.1% in the first half of 2016, the company said they were down to 2.4% for the full year.

Acting as a backdrop, data released on Tuesday showed CPI jumped at a 2.3% year-on-year clip in February, easily surpassing economists' forecasts and stoking worries that shoppers' spending would soon come under heightened pressures.

Heading the other way, shares in steel-maker Evraz were bouncing back after being thrashed the day before as a weaker US dollar weighed on Chinese rebar futures.

Interest rate sensitive issues such as utilities or telecoms operators like BT Group also found a bid as investors took profits on their more cyclical brethren following a pull-back on Wall Street during the previous session.

Traders referenced doubts regarding the credibility of the White House's promises of economic stimulus and what the timelines involved might be as the chief reasons behind the selling.

Nonetheless, on longer time frames other oberservers appeared to be more sanguine.

JP Morgan strategist Mislav Matejka was a case in point, having told clients on 20 March that: "As for the overall market, pundits keep recycling their old correction calls. Of course, at some point there will be weakness, but focusing too much on a potential pullback might miss the big picture, that this is the first synchronised global recovery since ’09. We stay constructive."

Top performing sectors so far today
Industrial Metals & Mining 2,406.37 +2.07%
Fixed Line Telecommunications 3,793.29 +1.01%
Forestry & Paper 20,810.26 +0.21%
Gas, Water & Multiutilities 6,271.79 +0.18%
Mining 16,177.04 +0.15%

Bottom performing sectors so far today
Electronic & Electrical Equipment 5,308.40 -1.72%
General Retailers 2,445.04 -1.65%
Food Producers & Processors 7,956.11 -1.52%
Industrial Engineering 11,170.91 -1.51%
Food & Drug Retailers 2,977.70 -1.50%