Tax cuts fueling revival in Australia's discretionary spending, Morningstar says

Harvey Norman Holdings

15/10/2024 24:56

** Analysts at Morningstar expect a broad rebound in retail
spending from fiscal 2025 in Australia, reflecting meaningful
tax cuts coupled with larger workforce and higher wages
    ** Brokerage says significant interest rate cuts by the
local central bank could support consumer sentiment and present
upside risk to our near-term outlook
    ** Morningstar says trading momentum for discretionary items
have already been picking up with sales growth as Woolworths'
 WOW.AX  Big W discount stores and Super Retail's  SUL.AX 
chains
    ** Sales momentum is also strengthening at electronics goods
retailers JB Hi-Fi  JBH.AX , Harvey Norman  HVN.AX , and Kogan
 KGN.AX      
    ** Brokerage does not have a positive outlook on
supermarkets as rising costs are weighing on operating margins
    ** Supermarkets also face heightened public scrutiny -
Morningstar
    ** Supermarkets have lost share of the consumer's wallet as
shoppers prefer eating and drinking outside the home, says
Morningstar

 (Reporting by Rishav Chatterjee in Bengaluru)
 ((Rishav.Chatterjee@thomsonreuters.com;))