Shoddy Christmas Sales Growth, Worst Since 2008 « Market Montage

We return to holiday trading with news that the annual hype via the financial media (stationed at parking lots throughout America to tell us how "wicked awesome" sales will be due to foot traffic and "lots of people are out on Black Friday"), has once again fallen flat on it's face. Retail sales are up 0.7% but that just about covers population growth and a tiny bit of inflation.  Adjusted for both it's a negative number year over year.  The usual suspects will be trotted out – superstorm Sandy, fiscal cliff worries, a lot of people glued to TV that critical last weekend due to the tragedy in Newton, etc etc.  Truth be known it's just another data point in the "meh" economy.

  • Sales in the two months before Christmas increased 0.7 percent, compared with last year. Many analysts had expected holiday sales to grow 3 to 4 percent.
  • Online sales, typically a bright spot, grew only 8.4 percent from Oct. 28 through Saturday, according to SpendingPulse. That's a dramatic slowdown from the online sales growth of 15 to 17 percent seen in the prior 18-month period, according to the data service.  Online sales make up about 10 percent of total holiday business.
Markets are looking to open flatting to slightly up – if it's anything like Monday expect this to be like watching paint dry.  If we had opened with a solid negative it would be the first three day run of gap downs I can remember in a long time; almost all the gaps post March 2009 are to the upside and even during selloffs we usually see decent opens and bad closes.  The S&P 500 continues to struggle with the 1420s area which it has been stuck in for most of the year.  Whatever happens in the next few days, 2012 is shaping up to be the year of the first quarter – all the progress came in January – March.   The S&P 500 opens today 7 points above the April 2nd (first day of Q2) close… there has been a ton of gyration in the past three quarters but no ultimate movement.

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Any securities mentioned on this page are not held by the author in his personal portfolio. Securities mentioned may or may not be held by the author in the mutual fund he manages, the Paladin Long Short Fund (PALFX). For a list of the aforementioned fund's holdings at the end of the prior quarter, visit the Paladin Funds website at http://www.paladinfunds.com/index.php/the-fund/holdings