Sales fall as higher rates impact on retail industry

US fund managers are underweighting the retail sector on the back of concerns over the domestic economy. Perpetual and Martin Currie are both underweight the sector in the belief it is being hit by the slowdown in US growth. The retail sector has also been underperforming the main market with the S&P Retail Stores' Specialist sector seeing a fall of 10.75% in dollar terms in the 12 months to 23 June compared with a rise of 8.27% in the S&P 500 over the same time period. Phil Chappell, US fund manager at Perpetual, says: "The sector has been very weak this year. Sales have started to slow ...