UPDATE 2-Australia's JB Hi-Fi H1 profit surges but shares drop

(Adds share price fall, analyst comments)

By Victoria Thieberger

MELBOURNE, Feb 12 (Reuters) - Australian home electronics retailer JB Hi-Fi Ltd (JBH.AX: Quote, Profile, Research) posted a 60 percent jump in first-half profit, boosted by ravenous demand for flat-panel TVs, and upgraded its outlook but its shares were hit on worries about consumer spending.

The retailer said sales so far in January and February have continued the strong momentum of the first half and profit for the full-year would rise as much as 49 percent.

Its shares initially rallied 2 percent, but swiftly reversed course to trade down 9.0 percent at A$11.48 at 1139 GMT, as investors worried more about the impact of rising interest rates on future sales.

"It's another in a long line of retail stocks that has delivered a very good result and been sold off regardless. The market is more concerned about rising interest rates and consumer confidence levels," said ABN AMRO Asset Management portfolio manager Matthew Hoult.

"A lot of top quality retailers are being sold off with abandon," he said.

Upmarket retailer David Jones (DJS.AX: Quote, Profile, Research) met with a similarly harsh reception on Monday to a profit upgrade, initially gaining 6 percent then closing down 4 percent after Australia's central bank warned interest rates will probably need to rise further.

Analysts have said consumer spending is set to slow this year as the economy softens and the central bank engineers a slowdown in demand.