US retail stocks hold steady despite muted holiday shopping season

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US retail stocks hold steady despite muted holiday shopping season

US retail stocks holds steady on Friday as investors appeared to be gauging consumers’ confidence amid growing inflation alongside an increase in interest rate. Apart from that, consumer discretionary stocks, which are measured by S&P 500 consumer discretionary sector, edged up marginally, as spending on retail, restaurants alongside seemed to have slowed down.

On top of that, traders’ numbers were thin as well which eventually had added to a drag on Wall Street on Friday. If truth is to be spoken, US retail stocks are down over 32 per cent year-to-date so far, nearly a double in losses of what S&P 500 had been witnessing.

Meanwhile, citing that a muted Black Friday sales had pointed towards a jejune holiday shopping this year, a market analyst at OANDA, Craig Erlam said, “Black Friday shopping takes a hit this year, it won't bode well for the rest of the holiday period which is so important to retailers”.

Retail stocks flatlined as US economy slows down

Meanwhile, addressing that the US economy has been slowing down more than anticipated, a chief investment strategist at the Leuthold Group, Jim Paulsen said, “These stocks are a clue as to how fast the economy is slowing and whether slowing inflation is lifting confidence on Main Street”.

Nonetheless, on the brighter side of the coin, consumers spent a record $5.29 billion online on this year’s Thanksgiving day, however, in-store purchases remained extremely poor. However, the US Fed had predicted earlier in the second half of the year that US economy would slow down over the third quarter of the year, while its benchmark borrowing costs could rise above a 5.0 per cent level as early as early-2023.