if you take most of the retailers over the last 3 months virtually all of them have reported terrific final quarters. they include coles, woolies, david jones, harvey norman, brazin, noni b, colorado and the warehouse group. why?
the govt family allowance increases of $600 per child per annum and the baby bonuses of $3,000 has pumped several billion dollars instantly into the economy. this money aint going to buy cars and houses but it will be enough for groceries and clothes, etc. throw in the recent tax cuts to middle income earners and you've got an environment perfect for retailers.
coles should have a bumper 12 months and with fuel costs so high consumers will want to take advantage of a 4 cent reduction per litre so they will go out of their way to shop at coles or woolies.
so my own opinion is there are risks in shorting or buying puts. I have seen a couple of analysts reports recently targetting $10.50 for coles in the short term.
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