Trends in Retail Stocks

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Market volatility continues to penetrate a wide variety of market segments including retail stocks. While considerable drops in oil pricing has saved consumers a great deal of money at the gasoline pumps, many retailers are not seeing that convert into revenue through increased spending in other areas.

Even high-end brands such as Ralph Lauren are trending downward as of this writing, with a 17% slide largely due to earnings reports that were actually better than expected EPS against revenues that were worse than expected. Declines wholesale sales decreased in US markets but were offset by increases in European markets. North American retail markets were down largely due to milder temperatures in the region that reduced demand for updated Fall and Winter apparel for both individual use and holiday shoppers. Reductions in tourism also accounted for a drop in retail markets in those markets. Unsurprisingly Ralph Lauren’s e-commerce segment experienced growth as consumers continue to migrate toward online sources for their purchases.

In other markets:

Toy makers Hasbro and Mattel have recently experienced rising sales, much of this attributed to the popularity of Star Wars items and increased demand for popular items such as Barbie dolls and Hot Wheels.

Automobile sales have dropped in US markets keeping the overall retail results essentially flat as 2015 came to a close.

While oil prices have provided a windfall for consumers, retailers have observed that shoppers are being cautious with their spending and look for bargains on the items they need. This results in cutting retail prices to attract sales, especially where seasonal items are concerned. In an effort to clear inventories retailers have cut profit margins to make sales.

What is the Trend for Retail Stocks?

Consumers are becoming increasingly reliant on mobile applications and e-commerce channels for product selection and reviews from other customers. As this expands to more retail categories it will be the businesses that embrace technology and enhance the customer experience that realize the highest returns on their investments.

For investors and day traders this signals the trend toward technology that enables shoppers to find products quickly and easily and facilitates safe, quick checkout and payment processes. Traders should focus on tech-savvy retailers with an omni-channel approach to moving products that includes integration with social media.

Millennials are setting the pace for retailers with demand not only for products and services but for retailers’ commitment to making the shopping experience pleasant and mobile.

Retail Stocks and Day Trading

Keep abreast of how retailers are meeting the expectations of consumers through the use of technology and social media. Another consideration for trade execution is the technology utilized itself. As retailers become more committed to the use of technology those companies that provide mobile devices and point of sale equipment and services will reap their share of the revenue as well.

Be sure your online broker is also committed to your need for high-performance and an effective use of technology that supports your trades anywhere, anytime, on any device.

SureTrader is a leading online broker with tools and news sources for accurate analysis and lightning-fast trade execution. SureTrader provides friendly and courteous support available to our clients on a 24×7 basis to answer any questions and resolve problems.

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Disclaimer: SureTrader Blog is not intended for U.S. persons. Stock information is not to be viewed as buy or sell recommendations.

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