Although some airlines and luxury clothing companies have reported a softening in European consumer demand, JPMorgan analysts said they "do not think there is clear evidence of incremental weakness developing" in the European clothes-buying consumer.
UK weakness seen in recent months has been "weather-driven", they stressed, with "limited top-line read across" from the luxury and airlines companies.
"Following weaker than expected luxury reporting and mixed updates from the passenger airlines (with Ryanair in particular a negative surprise), combined with very soft June UK clothing market data from Kantar - even for bellwether Next" analyst Georgina Johanan said her team had frequent incoming inquires from investors over the past week "on whether the consumer is softening".
Their view is that these disappointments in other sectors instead reflect "normalisation of elevated and somewhat inelastic spending trends, particularly in airlines as consumers continued to prioritize holidays post the pandemic".
Weighing on luxury has been a softening Chinese consumer, she said, and though the UK has been affected by bad weather "a more price-sensitive consumer is perhaps a developing theme".
Heineken results referenced incremental promotions in June, which while not directly a negative for general retail, "it could signal earnings risk into 2025 if freight remains elevated", with prices currently more than 400% above normal levels.
"We think the ability to offset this potential margin pressure through price increases is looking increasingly unlikely."
The JPM retail team also highlighted unrest in Bangladesh, noting that Marks & Spencer has the largest exposure to Bangladesh sourcing at circa 40%, followed by H&M at around 30%, Next PLC (LSE:NXT) at around 28%; AB Food's Primark circa 20%.
Sea freight also reached $8k per container in-line with average levels through 2022 (a year when retailers later faced material margin pressure), while cotton prices are now down 16% this year and back broadly in line with 2019 levels.