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US retail sales grow, Westfield sinks

After a run which has seen the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) fall around 10% since mid-May, the market has today added 75 points to the index to be trading at around 4,770 points – largely driven by the banks and mining stocks. In mid-afternoon trading however, shares in shopping centre owner Westfield Group (ASX: WDC) were trading 1.3% lower.

Westfield is one of the stocks to have suffered over the last month on the equities market. Having traded for as high as $12.55 per share, it is now sitting just above $11.14 – representing an 11% depreciation in value.

One of the reasons behind today’s fall could be due to the release of US government data relating to retail sales for May. Whilst the data revealed that retail sales for the month grew by 0.6% – double the amount that analysts were expecting – this figure largely reflected car and auto sales. The data also revealed that consumers cut their spending on discretionary goods including clothing, furniture and electronics, due to flat income gains.

Regardless of where the retail sales came from, investors should be glad to see that consumer confidence in the US is on the increase. Whilst Westfield Group and its affiliate Westfield Retail Trust (ASX: WRT) have a number of interests in America, their stores should start to see further profitability as consumer confidence continues to increase.

At today’s prices, it seems as though Westfield just may be a good company to add to your portfolio. With interests in Australia, New Zealand, the UK and US, one of its primary focuses of late has been to return shareholder value through the re-purchasing of shares, ridding itself of underperforming assets as well as redeveloping its most profitable stores.

Other property groups such as Stockland (ASX: SGP) and GPT Group (ASX: GPT) are trading slightly in the green today, whilst the value of their shares have also significantly decreased since last month.

Foolish takeaway

Westfield is one of Australia’s largest companies with a market capitalisation of $24.8 billion, and interests in 105 shopping centres. The company’s strategy to create a stronger portfolio through acquisitions, redevelopments and strategic divestments, as well as looking to return shareholder value, makes this company a very attractive core prospect for your portfolio – compounded by its 4.4% dividend yield for income investors.

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Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned in this article.

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