Medicines and cosmetics only bright spots in July retail sales

Jewellery and watches sales continue to drag.

Hong Kong retail sales in July were at HK$38.7bn, down 3.1% y/y by value, slightly worse than Bloomberg consensus forecast of down 2.7% y/y, with the decline narrowed from the down 6.9% y/y seen in June.

According to a research note from Barclays, July continues to be dragged by the jewellery and watches segment, while medicines and cosmetics was the only category that saw acceleration in growth.

Medicines and cosmetics was the only bright spot, which saw an acceleration to +14.3% y/y growth in July, much better than the 6.9% y/y growth in June.

Here's more from Barclays:

Department stores sales still down y/y: Sales for department stores saw a drop of 1.3% y/y in July, slightly more narrow than the down 3.5% y/y seen in June.

Clothing and footwear sales still slow: Sales for clothing and footwear in July was +5.7% y/y, slightly lower than the +7.2% y/y seen in June.

Jewellery and watches continues to decline significantly y/y: Due to the strong base effect from gold rush, jewellery and watches sales continued to be down by 22.2% y/y in July, although is slightly better than the 22.2% y/y seen in June.

Consumer durables declined; food, alcohol and tobacco sales grew: Consumer durables sales continued to be down 6.2% y/y in July, vs the 7.8% y/y decline in June.

June sales for food alcohol and tobacco increased 7.5% y/y, similar to the 8.6% y/y seen in June.