Christmas is just a week away, and we are now nearing the end of the holiday shopping season – and the seasonally strong month for the stock market.
But yesterday, Wall Street woke up on the wrong side of the bed. And that’s largely due to the disappointing November retail sales report.
The Commerce Department revealed that, for November, retail sales fell 0.6% – well below the Dow Jones estimate for a 0.3% drop. It is also the worst monthly decline in 11 months.
In today’s Market 360, let’s dig into the details…
Vehicle sales, which rose 1.5% in October and were expected to remain strong, dropped 2.3% in November. And other big-ticket items, like furniture, building materials and electronics, declined 2.6%, 2.5%, and 1.5%, respectively. Gas stations sales were down 0.1%, even with the average cost of gas falling across the country. Excluding auto and gasoline sales, November retail sales fell by a more modest 0.2%.
The only silver lining I could find is that sales at bars and restaurants rose 0.9%, which does tell us that consumers are still out and about. Food and beverage stores also rose 0.8%.
I should add that online sales also decreased, falling 0.9%, despite Cyber Monday’s record-breaking numbers, when shoppers spent $11.3 billion in total.
Shares of Amazon.com, Inc. (NASDAQ:AMZN), a dominator in the online retail space, slid around 4% following the retail sales report. As I mentioned two weeks ago, Amazon ranked as the most-searched-for retailer on Black Friday last year. This year, however, retail giant Walmart Inc. (NYSE:WMT) eclipsed Amazon for online searches for deals, surging 386% year-over-year.
For the third quarter, Amazon’s net income was down from the same quarter a year ago, and revenue guidance for the current fourth quarter was well below estimates. This was a major concern, as these earnings were released at the start of the big shopping time of the year.
So, it’s no surprise that the company continues to rate poorly in my Portfolio Grader.
As you can see in the Report Card above, Amazon has a D-rating for its Total Grade, making it a “Sell.” The reality is that the company remains affected by its weak fundamentals and poor earnings.
So, the question is, what companies should you invest in now?
Over the last three months, my InvestorPlace colleagues, Eric Fry and Luke Lango, and I have been putting together our stock market playbook to help you find high-quality companies. That research culminated into the event of the year: the Early Warning Summit 2023.
If you’re in the right high-quality companies, then your portfolio is well-positioned to make windfall profits in 2023.
Our Power Portfolio 2023 is our exclusive guide for positioning your portfolio to take advantage of all that next year will have to offer investors. We’ve picked eight stocks we expect to crush the market in 2023.
Sincerely,
Louis Navellier
The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:
Amazon.com, Inc. (NASDAQ:AMZN)
