LONDON (Reuters) - Britain's retail sector was boosted by Prime Minister Boris Johnson's resounding general election victory on Friday, as investors factored in expectations of a step-up in consumer sentiment and spending in the key holiday season period.
The poll victory will allow him to end three years of political paralysis and take Britain out of the European Union within weeks.
Shares in three of the UK’s four biggest supermarket groups - Tesco
Analysts said pent up consumer demand could find a release in big grocery shops in the lead up to December 25 and higher spending on so called "big ticket" items.
The protracted uncertainty around Brexit and the incessant media coverage was strong enough for consumers to reduce volumes in by 100 to 150 basis points, according to Bernstein analyst Bruno Monteyne.
"This is just in time for the most important food retail trading event: Christmas where families traditionally trade up when they feel good," he said.
The pound rallying to an 18-month high versus the U.S. dollar should further benefit retailers as it reduces the cost of importing goods and raw materials.
Shares in Associated British Foods
Uncertainty about Brexit and the election has weighed on Britain's property market this year.
With the path now clearer, at least in the short term, shares in Kingfisher
(Reporting by James Davey; editing by Mike Harrison)