Retail Sales Point to Slow ETFs and Holiday Sales | ETF Trends

The sharp slowdown in retail sales don’t bode well for this holiday season or related exchange traded funds (ETFs).

The September numbers are in, and few companies are immune from the slowdown – including bargain retailers. Many of them saw significant declines as low as the double digits, reports Stephanie Rosenbloom for the New York Times.

Same-store sales open at least a year plunged 14.8% for Stein Mart (SMRT). J.C. Penney’s (JCP) fell 12.4%, and Dillard’s (DDS) sales were off by 12%. Target (TGT) declined by 3%. Wal-Mart (WMT) and Costco (COST) managed to report solid sales, but even their numbers were off estimates on Wall Street.

Not surprisingly, the weakest categories were non-essential items.

  • SPDR S&P Retail (XRT): down 21.9% year-to-date
  • Retail HOLDRs (RTH): down 16.1% year-to-date; Costco is 5.9%; Target is 8.8%

Retail Exchange Traded Funds (ETFs)

Pending sales of existing homes in the United States delivered a surprise jump in August to their highest level in more than a year. The National Association of Realtors said the Pending Home Sales Index rose 7.4%, reports Lynn Adler for Reuters. The expectation was that sales would drop by 1.8%.

But some analysts say the performance might be short-lived, as the global financial markets are entering a period of heightened chaos.

  • DJ Wilshire REIT (RWR), down 15.3% year-to-date (black line)
  • iShares FTSE NAREIT Real Estate 50 (FTY), down 16.4% year-to-date (green line)

Real Estate Exchange Traded Funds (ETFs)

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.