May 08, 2008 at 11:00 am by Tom Lydon
Retail exchange traded funds (ETFs) were down midday today despite better-than-expected numbers from retailers.
Despite the more positive numbers, though, it was still suggested that consumers are curbing their spending in the wake of higher energy and food prices. Wal-Mart (WMT), for example, said sales of groceries, medications and flat-screen TVs boosted sales by 3.2% in April, reports Madlen Read for the Associated Press.
But apparel stores continued to be hit with depressed sales as people cut back spending for new clothes and take the cash to the grocery store or the gas station. The job market is also hurting consumers - there have been four consecutive months of net losses.
Among the ETFs trading lower this morning after the reports:
- Retail HOLDRs (RTH), up 2.4% year-to-date
- Consumer Discretionary SPDR (XLY), down 1% year-to-date
- PowerShares Dynamic Retail (PMR), up 0.4% year-to-date
- Rydex S&P Equal Weight Consumer Discretionary (RCD), up 0.6% year-to-date
For full disclosure, some of Tom Lydon’s clients own shares of RTH.
Read the disclosure, as Tom Lydon is a board member of Rydex Funds.
Tags | Gas, Retail & Consumer
