Retail sector weighs on the bourse

STOCKS turned lower yesterday led by the retail sector after clothing retailer Mr Price reported low third-quarter sales.

The benchmark JSE Top40 index dropped 0.62 percent to 46 045.01 points while the all share index declined 0.64 percent to 52 817.73 points.

The retail sector ended a two-day rally, dropping 2.07 percent after industry barometer Mr Price reported lower third-quarter sales. Weak economic growth and tough competition forced the no-frills retailer to sell its clothing at lower prices.

“The weak sales performances reflect an apparel market that is challenged by a combination of new competition, discounting of excessive stock and a cautious consumer,” Kagiso Asset Management associate portfolio manager, Simon Anderssen, said.

Mr Price retreated 4.79 percent to R156, competitor Truworths dropped 3.21 percent to R82.81 and jewellery and furniture retailer The Foschini

Group was down 3.09 percent to close at R163.30.

Meanwhile, US stocks came off session lows yesterday afternoon as gains in consumer staples stocks countered the decline in banks and healthcare companies.

The Standard & Poor’s 500 healthcare sector was down 0.85 percent.