Retail Group Breaks Support

Macy's (M) has brought the retail group down once again today on news that it slashed its dividend and will cut 7,000 jobs. Along with the Financial sector, retailers have been one of the hardest hit groups during the current recession. And unfortunately, the retail group broke through key support today that has previously held a number of times over the past couple of months. This breakdown is not a good sign for the group or the entire market.

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For those interested, below we highlight the companies that make up the S&P 500 retail group. For each stock, we provide its year-to-date performance along with its indicated dividend yield (since Macy's cut its dividend today). As shown, Office Depot (ODP) is off the most this year with a decline of 37.58%, followed by Sherwin-Williams (SHW), Limited Brands (LTD), and Abercrombie & Fitch (ANF). Six stocks in the group are up this year, and two of them are online retailers (EXPE and AMZN). As consumers continue to bunker down, they're doing more of their miniscule purchasing online, which is a big negative for the brick and mortar companies that already have high overhead.

Comments

[Ariel-UBT:]

The RTH was one of the 3 "Top Bullish" at the ISE site just on Monday, 2/2 - also a clue that sentiment too hot in this sector.

Feb 04 06:11 PM