Sector movers: High Street retailers rise but supermarkets fall

30th May 2013 14:00

Retail stocks were putting in a mixed performance on Thursday with High Street stocks making gains and supermarket firms in the red.The General Retail sector was among the best performing categories this afternoon with B&Q owner Kingfisher making solid gains despite a slightly disappointing first-quarter update. The company reported a worse-than-expected 28% fall in earnings before interest and tax in the first three months of the year with the like-for-like sales decline at B&Q and its chains in France coming in well below forecastsNevertheless as Credit Suisse pointed out, the first quarter is "small" in comparison to other periods, representing just 15% of the full-year result. The broker, which rates the stock 'outperform', does not see material risk to full-year profit forecasts, though said that this relies on improving macro trends and more normal weather than was seen at the start of the year.In a research report, Credit Suisse analyst Simon Irwin said: "Macro datapoints are turning in UK and France and we still believe that 1Q represents the start of a cyclical recovery. As this becomes clear we expect Kingfisher to return to a premium rating and we reiterate our 410p 12-month target price."The stock was up 3.54% at 339.4p, following closely behind by General Retail peers Dunelm, Halfords, Darty, Home Retail, Sports Direct and Debenhams.Heading the other way were the heavyweight supermarket stocks after a gloomy report by JPMorgan Cazenove which this morning reiterated its "cautious view" on the UK food retail market.In a note in which is downgraded its rating for Tesco from 'overweight' to 'neutral', the broker said that sector fundamentals remain "unattractive" for a variety of reasons: "4.0% space growth; flat volumes; private players taking 80 basis points (bp) of market share; online taking another 80bp, industry profitability at an all-time high, potential implication on supermarket property prices." All of these "do not bode well for the industry and, as a result, for Tesco", the broker said. Tesco was down 2.09% at 365.2p in afternoon trade, joined by Morrison and Sainsbury which were also in negative territory.Top performing sectors so far todayTechnology Hardware & Equipment 1,170.62 +1.98%Industrial Metals & Mining 1,620.72 +1.84%Banks 5,117.17 +1.16%General Retailers 2,417.40 +1.14%Mining 16,814.55 +1.12%Bottom performing sectors so far todayFood & Drug Retailers 4,570.82 -1.68%Electricity 9,663.33 -1.25%Gas, Water & Multiutilities 5,930.66 -1.10%Fixed Line Telecommunications 3,508.22 -0.85%Industrial Transportation 2,792.88 -0.84%