19 mei 2022
11:34
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Fears that cost inflation will eat away at profit margins are putting even a ‘defensive’ sector like retail in the rams.
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European stocks are deeply in the red. The Brussels share basket Bel20
loses more than 2 percent around noon. A similar loss is for the European star basket Euro Stoxx 50
.
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‘Tiens, weren’t supermarkets a defensive sector?’ asks Frank Vranken, the chief strategist of asset manager Edmond de Rothschild. ‘Low risk profile and almost always rock solid in a harsh climate?’
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The answer: not in this climate. Retailers are struggling with skyrocketing cost inflation, which is becoming increasingly difficult for them to pass on to customers.
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Harddiscounters
Otherwise they risk losing that customer to hard discounters. Wednesday flourished on Wall Street TJX
the holding above budget chains like TJ Maxx† The Colruyt share, normally one of the most recession-proof shares on the Brussels stock exchange, tumbled yesterday to its lowest level in ten years.
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Retailers are not the only ones struggling to calculate the rapidly rising costs for energy, food, transport and personnel. In Brussels, CFE . warns
right in front of daughter DEME is separately brought to the stock exchange that the maritime service provider, so DEME, will see its profits fall in 2022 due to cost inflation. Shares of CFE plunged to 14 percent lower in morning trading.
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Same in London. That’s where Royal Mail tumbles
13 percent. The mail group warns in an update for inflationary pressures. She makes it clear that even if the staff agrees with the offered wage offer, it is not certain that the analyst consensus for the current financial year will be achieved.
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Consent is by no means certain. The trade union CWU labeled Royal Mail’s salary proposal as ‘offensive’. The postal group proposes a wage increase of 3.5 percent, plus a bonus, in two steps. But meanwhile, UK inflation has risen up to almost 8 percent.
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