It's been a bad day for Australia's retail sector after it was revealed consumer confidence is once again being weighed down by federal budget concerns.
Following three months of improving conditions, the Westpac Melbourne Institute Index of Consumer Sentiment fell by 4.5% in September to be sitting at just 94 points, where a figure below 100 highlights pessimism is outweighing optimism in the economy. Commenting on the outcome, Westpac's chief economist Bill Evans said that although Aussie households were now more comfortable with the budget, it still dominates their thinking when it comes to spending.
Of course, this comes as bad news for Australian retailers which are already struggling against the rapid rise of the online retail sector. Companies like Super Retail Group Ltd (ASX: SUL) and The Reject Shop Ltd (ASX: TRS) were forced to lower their earnings guidance as sales took a big hit in the weeks following the budget's release. The market is also clearly concerned there could be more pain in the months ahead.
Shares of Super Retail Group, for instance, have fallen 1.6% today while Harvey Norman Holdings Limited (ASX: HVN) and Myer Holdings Ltd (ASX: MYR) have both fallen 1.3% and 0.8% respectively. Not even Flight Centre Travel Group Ltd (ASX: FLT) could escape the market's wrath with the travel agency's shares trading 0.8% lower today.
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Although it can be unnerving watching the market and individual stocks tumbling in value, it can also create a fantastic opportunity for investors to buy shares trading at discounted prices. In my opinion, Flight Centre and Super Retail Group are looking particularly appealing today and would be great investments for new money.
