Soft sales, escalating macro headwinds plague consumer stocks

ASEAN markets won’t pick up anytime soon.

After reporting lacklustre numbers in the second quarter, SGX-listed consumer companies have little to look forward to in the second half of the year.

According to OCBC Investment Research, there are no signs of a sustained pickup in consumer sentiment for key ASEAN markets, which means that sales will remain soft in coming quarters.

This comes on top of increasing market volatility brought about by the US Fed rate hike decision, China’s slowdown and recent Renminbi devaluation.

“We are keeping our neutral call for the consumer sector amid challenging times while government reforms support a better outlook in the longer term,” OCBC said.

OCBC remains upbeat on local retailer Sheng Siong and multinational food and beverage company ThaiBev, but is unimpressed with Indonesia-focused Petra Foods.