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Sales data is showing signs of improving consumer sentiment, Macquarie Group (ASX: MQG) says, with sellers of electrical goods and health products standing to benefit in particular, while the alcohol sector remains challenging.
Macquarie's High Frequency Consumer Data is proprietary information which the investment bank collates, and which "provides a sample of consumer spending habits on a weekly basis''.
Macquarie says the data is not perfect, with a weighting towards Melbourne and Sydney, but says it's currently providing some interesting insights.
In the August reporting season, consumer names called out green shoots in the consumer environment, supported by household income growth, lower interest rates and disinflation. Our data is consistent with this, with a fairly even spread of discretionary and non-discretionary categories now taking share after a period of dominance in non-discretionary. We are seeing this play out in our data, with electronics spend still in mid-to-high single digit growth versus the previous corresponding period.
Macquarie said early FY26 trading was positive for both JB Hi-Fi Limited (ASX: JBH) and Harvey Norman Holdings Limited (ASX: HVN).
Meanwhile, pharmacy continued to be the strongest growth category "which we see as likely driven by strong growth in Chemist Warehouse (ASX: SIG), in categories such as health & beauty (i.e., 'treatonomics'), and vitamins & supplements, while also taking share from the supermarkets and department stores".
Alcohol was a sector which continued to face headwinds, with off premise sales continuing to lag. Macquarie said there was a significant pull-forward of demand over the period of the pandemic, which was impacting sales now.
With soft data in the off-premise alcohol category, we continue to see weakness for Endeavour Group Limited (ASX: EDV), particularly as it is facing competitive pressure from Coles Liquor and online players. Essential categories of Insurance, Telco and Healthcare continue to be wallet share gainers over the last 12 months, while discretionary categories of electronics, restaurants, travel, and pharmacy also achieved wallet share gains. The decline in utilities are likely driven by government rebates.
