Currys PLC (LSE:CURY), Tesco PLC (LSE:TSCO) and Kingfisher PLC (LSE:KGF) were among the retailers tipped to benefit from signs that UK consumer spending strengthened in June, while Primark owner Associated British Foods PLC (LSE:ABF) could be one of the main loser as shoppers increasingly bought online.
Analysts at Citi said industry data from the British Retail Consortium and Barclaycard pointed to a sequential improvement in retail sales, driven by stronger demand for non-food products.
The BRC reported total sales growth of 1.9% in June, while two-year comparisons suggested momentum improved from May. Non-food sales strengthened, while online sales accounted for the highest proportion of retail spending so far this year.
Barclaycard's spending data, which covers the period to 19 June and therefore excludes the late-month heatwave, also pointed to improving demand for DIY and electrical goods, marking the first growth in those categories since May 2025.
Citi said the trends were positive for retailers with significant exposure to electronics and general merchandise, naming Currys, Tesco, Kingfisher, J Sainsbury PLC (LSE:SBRY), B&M European Value Retail SA (LSE:BME) and Wickes Group PLC (LSE:WIX) among the potential beneficiaries. It also favoured Next PLC (LSE:NXT) because of its strong online business.
The US bank said the data was less encouraging for retailers with limited online operations, highlighting ABF's Primark chain and B&M.
Citi also noted the BRC's reiterated warning that rising operating costs were "squeezing retailers' ability to invest, create jobs and keep prices down", despite the improvement in sales.
