Super Retail Group Limited (ASX: SUL) shareholders were amongst the market's biggest winners last week as the stock gained 7.4%. In comparison, the S&P/ASX 200 Index (Index: ^AXJO) (ASX: XJO) gained just 1.5% in what was a strong start to the new financial year.
Although the company did not release any specific news, there are a number of reasons which could explain the rise.
For starters, the stock has fallen heavily in price in recent months, largely due to the declining consumer confidence levels thanks to the government's horror budget. In fact, since early March it has fallen more than 22%! Investors may have recognised the fall as an opportunity to buy shares on the cheap.
Additionally, positive growth news from China and the United States, as well as the Reserve Bank of Australia's decision to keep interest rates on hold at 2.5%, would have provided a boost to confidence levels in the sector. JB Hi-Fi Limited (ASX: JBH), The Reject Shop Ltd (ASX: TRS) and Harvey Norman Holdings Limited (ASX: HVN) also recognised gains over the week, climbing 3%, 9.5% and 0.3% respectively.
An even better opportunity than Super Retail Group
In my opinion, Super Retail Group is one of the brighter prospects from the retail sector. It has proven itself as being resilient through the toughest of times and, although it has hit a few hurdles recently, is still on track to grow earnings by 5%.