Retail share prices fell yesterday as concerns about the European debt crisis and the fragile US economy made for a turbulent day on the markets.
Doubts about the recovery of the global economy led to most major retailer’s stocks plummeting significantly although fashion retailer Next, which reported a steady half-year trading update earlier this week, held up well.
A statement published by stockbroker Arden Partners this morning suggested that a number of companies were left bemoaning weak share prices last night, with fashion retailer Supergroup seeing its share price fall 9.6 per cent and leading e-tailer Asos.com suffering a 5.5 per cent drop.
Meanwhile B&Q parent firm Kingfisher, consumer electronics specialist Dixons Retail and bike retailer Halfords, all saw prices slip by more than three per cent.
Nick Bubb, Retail Analyst at Arden Partners, said: “The All-Share index was down by as much as 3.5 per cent yesterday (Black Thursday?), as global recession fears rose yet again, devastating the banks and resources stocks.
“The embattled general retail sector was only down by 2.5 per cent.”
Recent surveys suggest food sales in the UK have fallen in the last month, and Bubb acknowledged that the food retail sector was “struggling” and dropped 1.6 per cent overall in yesterday’s markets.
The UK’s number one supermarket Tesco’s share price slipped 1.8 per cent, while Sainsbury’s fell 2.3 per cent.
Yesterday was a day of stock market chaos, with the FTSE 100 suffering its worst daily fall for more than two years and markets across the world experiencing significant slumps in value.
European stock markets have continued to struggle in early morning trade, highlighting investors’ ongoing concerns about various struggling governments’ capacity to repay their debts.
Jonathan Loynes, Chief European Economist at Capital Economics, said: “The recent sharp falls in financial markets have vindicated our bold expectations for equity markets and bond yields.
“While we are not minded significantly to redraw our forecasts at this point, there are clear risks of further steep falls which will deepen the downside risks to the global economy.”