Five retail stocks to look out for this Christmas

A host of high street big-hitters are upping their game over the festive period, and it’s good news for the companies, the consumer – and potential investors…

As consumer confidence continues to grow in the UK, retailers will be hoping to cash in as the Christmas rush gets going. But they won’t be the only ones with their eye on the tills, writes James Crux: investors, too, will be keeping tabs on which shops are pulling in the punters.

There are high expectations for retail sales this year. The UK has seen a return to real wage growth, consumer confidence is as high as it’s been for a decade – and falling food and petrol prices are boosting shoppers’ spending power.

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Rising disposable income could see consumers spending more on luxury items this year, including high-end food products. Marks & Spencer has been pushing its range of party food, and appealing to those who want to take the stress out of Christmas grocery shopping with its Food to Order service. The retailer has also improved the style and quality of its fashion ranges, setting it up nicely for the festive period. Luxury-goods maker Mulberry, meanwhile, is hoping for a rush on its covetable handbags.

Dixons Carphone, which owns brands from PC World to Currys, has been striving to reinvent itself with superior customer service, attractive branches and a well-stocked online service.

That could put the group at the forefront of shoppers’ minds when they decide where to buy a big-screen TV for the family, a laptop for the kids – or a smartphone for gran.

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It might also be worth taking a look at the DFS furniture chain. It’s currently sitting pretty, with increasingly confident UK consumers likely to spend on big-ticket items, and seek out its guaranteed deliveries of handmade sofas ahead of 25 December.

There will be many people who want to avoid the fuss of crowded shops, preferring to do all their Christmas shopping online. Much attention, therefore, will be paid to the retailer ASOS, as the tech-savvy youth demographics splurge on fashion items. The company has spent money to improve its online platform and warehouse capabilities, answering consumer demand with easy ordering and swift delivery.

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