{I-bank focus}HK retail sales seen to fall 34% on protests

   Jefferies Research said its channel checks revealed a worrying trend. Due to the ongoing protests in HK, many travelers (both business and leisure) have canceled their trips to the city (inbound tourists down more than 30% for first 10 days of August 2019).
  Not surprisingly, hotels, in general, are seeing a sharp reduction in occupancy rate (ie occupancy rate at Four Seasons now hovers at 40-50% compared with 60-70% at the same time
last year).
  Given that tourists account for 40% of HK retail sales and locals are also staying longer at home over the weekends to avoid the chaos, the retail industry is also being hurt badly, with HK retailers on average experiencing single to double-digit sales decline since June 2019, based on industry sources.
  For retailers in the protest areas, some even report a 60-70% decline in sales. In addition, in the transportation segment, taxi drivers also claimed to have experienced a 30-40% drop in business due to detours arising from the protests. In essence, the protest is seriously damaging the HK economy on varying levels.
  Jefferies estimated retail sales could fall by almost 34% from 2018, on an annualized basis.