Only Amazon’s Stocks Shine in the Retail Sector
For any stock trader it is important to analyze the industries that exhibit growth and performance rises. The retail sector is currently going through a hard time except for one major player.
When it comes to the retail sector, it seems the one name that comes to mind is “Amazon.” Amazon is probably the most popular and most used retail business in the world, and this is shown even in the performance of its stocks. It has directly taken on not only other online retailers but brick-and-mortar retailers as well.
In the previous week, stocks of retailers generally went through a rough patch. While the exchange traded fund for tracking the retail sector, SPDR S&P Retail, went 3.0% in the five days of the week, Amazon’s shares actually gained 5.3%. Even Macy’s experienced poor earnings this week and it showed in its stock value too. Amazon’s market share keeps rising, even as brick-and-mortar retailers are continuing to struggle to adapt to the intense competition posed by online retailers.
Retail sales in the US grew by 1.3% from March to April, which was the fastest growth rate in over a year, but it wasn’t the brick and store retailers that accounted for it but automobiles, gas stations and retailers in the non-store category. That latter category is where Amazon slots in.
Amazon has been outperforming its brick-and-mortar competitors by over 180% from early 2015. This growth can only be accounted for by the increased consumer exodus towards online platforms and the development of apps that bring ecommerce to mobile users. It wouldn’t be wise for investors to own shares in conventional brick-and-mortar retailers now, unless they could figure out a way to tackle Amazon’s increasing market share.
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