4 Stocks To Yield Better Returns As Retail Sales Pick Up
Zacks Investment Research | Mar 25, 2018 09:24PM ET
The current market scenario for the retail industry is quite encouraging. After facing declining sales, store closures and bankruptcy, the retail space is likely to pick up pace in 2018. The Commerce Department report revealed that while retail sales dropped 0.1% in February, core retail sales inched up 0.1% after remaining flat last month. Core retail sales data exclude sales figures of automobiles, gasoline, building materials and food services.
Per an analyst report by Deloitte, the retail market is projected to grow 3.2% to 3.8% in 2018. The linchpin to the strong near and long-term retail industry outlook is a strong labor market and rising consumer income.
Retail sales in the United States account for roughly 30% of total consumer discretionary spending and therefore the industry is highly reliant on overall economic conditions. According to the Federal Reserve’s most recent forecast, the economy is anticipated to grow at a reasonable rate of 2.7% in 2018. Unemployment rate is also predicted at 3.8% for 2018 from the current rate of 4.1%. Moreover, high real disposable income, low inflation, an uptick in house prices and a strong stock market are making the consumer pockets heavier. Now, it is to be seen how retailers compete to cash in on the increased consumer spending.
Notably, the Zacks Investment Research
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