News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Bullish
Oil - US Crude
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Mixed
GBP/USD
Bullish
USD/JPY
Mixed
More View more
Real Time News
  • Trading bias allows traders to make informative decisions when dealing in the market. This relates to both novice and experienced traders alike. Start learning how you may be able to make more informed decisions here: https://t.co/rz7fqhRoMG https://t.co/e4G1gTGhex
  • Greed is a natural human emotion that affects individuals to varying degrees. Unfortunately, when viewed in the context of trading, greed has proven to be a hindrance more often than it has assisted traders. Learn how to control greed in trading here: https://t.co/kODPAfJE79 https://t.co/pS48NIuwqX
  • Forex liquidity makes it easy for traders to sell and buy currencies without delay, and also creates tight spreads for favorable quotes. Low costs and large scope to various markets make it the most frequently traded market in the world. Learn more here: https://t.co/arxYmtQeUn https://t.co/gFVVZTGbe1
  • Forex quotes reflect the price of different currencies at any point in time. Since a trader’s profit or loss is determined by movements in price, it is essential to develop a sound understanding of how to read currency pairs. Learn how to read quotes here: https://t.co/CNtqrKWDBY https://t.co/nHXiNJhLes
  • A currency carry trade involves borrowing a low-yielding currency in order to buy a higher yielding currency in an attempt to profit from the interest rate differential. Find out if the carry trade suits your trading style here: https://t.co/7t4BzmLg8w https://t.co/h0TmJcZeqr
  • $USDCAD sold off aggressively last week, putting it into position to test the important 2017 low; trading bias is neutral to bearish. Get your market update from @PaulRobinsonFX here: https://t.co/sphxUAW9TB https://t.co/ZhsTeJOOM8
  • Get your snapshot update of the of top level exchanges and key index performance from around the globe here: https://t.co/d8Re5anlG5 https://t.co/qP96xmgDVn
  • The pro-risk Australian Dollar may extend gains after the record miss in US jobs data, amplifying dovish rhetoric from the Federal Reserve and keeping the Dow Jones and S&P 500 intact. Get your market update from @ddubrovskyFX here: https://t.co/yf8mPX3O3W https://t.co/uCCmjaxUhF
  • Who else is keeping close tabs on Dogecoin $DOGE this weekend? All eyes on Elon Musk @elonmusk, the proverbial 'Dogefather,' and his Saturday Night Live @nbcsnl performance kicking off at 11:30PM ET. The #crypto is already looking nice and perky following that trendline break! https://t.co/nrQsnlUqWj https://t.co/4lOz6NLQTG
  • There is some very interesting event risk over the opening half of this coming week of trade. It starts with Elon Musk hosting SNL tonight for Dogecoin traders and moves into US inflation data to as means to stir the ongoing Fed debate and Dollar https://www.dailyfx.com/forex/video/daily_news_report/2021/05/08/Dollar-Tumbles-Dow-Hits-Record-Highs-and-Dogecoin-Traders-Tune-In.html https://t.co/LXhjv7ToWC
S&P 500 Outlook: Retail Sector Slides Amid a Series of Missed Earnings

S&P 500 Outlook: Retail Sector Slides Amid a Series of Missed Earnings

Peter Hanks, Strategist

S&P 500 Outlook Talking Points:

S&P 500 Outlook: Retail Sector Slides Amid a Series of Missed Earnings

Tuesday trading saw the S&P 500 close comfortably higher after the United States Commerce Department offered a licensing extension to Huawei. Elsewhere, a mixed bag of earnings from Home Depot, JC Penny, Kohl’s and Nordstrom offered their own influence on the Index. While share performances from the companies were mixed, weakness was widespread and a familiar theme rang true throughout.

Home Depot

Shares of Home Depot (HD) traded higher in Tuesday’s session – despite a tough quarter by many metrics. The company blamed poor weather conditions, labor shortages and weak lumber prices for their in-store sales miss which increased just 2.5% compared to analyst expectations of 4.2%. Alongside weather, labor and lumber, the company warned of the potential impact from the US-China trade war.

View A Brief History of Trade Wars for background on economic conflicts like the US-China Trade War.

Edward Decker, executive vice president of merchandising for Home Depot sad the latest round of tariffs on Chinese goods would raise the annual cost of goods sold by about $1 billion. “We haven’t worked through what we will do if the cost increase comes to us. Sometimes when we have cost increases, we pass it through in retail prices, sometimes we don’t” he said on a conference call. Home Depot said it already saw a $1 billion impact from US tariffs in 2018. Despite the possible $2 billion hurdle, Mr. Decker said the total was manageable.

Home Depot (HD) Price Chart: Daily Time Frame (September 2018 – May 2019 ) (Chart 1)

Home Depot HD price chart

JC Penny

JC Penny (JCP) traded near its all-time low of $0.94 a share on Tuesday after warning of a “meaningful impact” on its private and national brands from the next round of tariffs on China. JCP CEO Jill Soltau said the tariffs that were already in effect have had a minimal impact on business, but the company would continue to work on “de-risking efforts” with suppliers.

JC Penny (JCP) Price Chart: Daily Time Frame (September 2017 - May 2019) (Chart 2)

S&P 500 Outlook: Retail Sector Slides Amid a Series of Missed Earnings

Kohl’s

Kohl’s (KSS) suffered a similar fate in Tuesday trading but offered no commentary on the US-China trade war. Same-store sales fell -3.4%, compared to analyst expectations of just -0.2%. In turn, the retailer slashed guidance. On the back of this news, KSS shares slid to their lowest since January 2018 and suffered their largest lower gap since January 27 at -12.15%.

Kohl’s (KSS) Price Chart: Daily Time Frame (December 2017 – May 2019) (Chart 3)

S&P 500 Outlook: Retail Sector Slides Amid a Series of Missed Earnings

Nordstrom

Finally, Nordstrom (JWN) weighed in with its own disappointing results. Consequently, the company cut guidance and JWN shares traded to their lowest since September 2010 in response. The company did not, however, blame or comment on the US-China trade war. Instead, JWN executives pointed to “softer trends and executional issues” for the quarterly underperformance.

Nordstrom (JWN) Price Chart: Weekly Time Frame (January 2009 – May 2019) (Chart 4)

S&P 500 Outlook: Retail Sector Slides Amid a Series of Missed Earnings

Retail Sector Falters on Widespread Weakness

Following the sector-wide miss, the XRT retail-tracking ETF traded at its lowest ratio to the S&P 500 since June 2009. While each company offered silver linings in their respective reports, the industry has been slow to adapt to Amazon’s disruption and the US-China trade war is yet another headwind for an already struggling space.

XRT ETF Price Chart: Weekly Time Frame (January 2008 – May 2019) (Chart 5)

S&P 500 Outlook: Retail Sector Slides Amid a Series of Missed Earnings

Ratio of XRT ETF to SPX overlaid in red

For the S&P 500, retail weakness was overshadowed by tech and semiconductor strength amid the Huawei licensing extension. Now the Index must negotiate Wednesday’s release of Fed minutes from the FOMC meeting earlier this month. From a technical perspective, the Index rests narrowly beneath the 38.2% Fibonacci retracement from March’s lows to May’s high. Ahead of the Fed minutes, follow @PeterHanksFX on Twitter for equity insight.

S&P 500 Price Chart: 1 – Hour Time Frame (May 2019) (Chart 6)

S&P 500 price chart

--Written by Peter Hanks, Junior Analyst for DailyFX.com

Contact and follow Peter on Twitter @PeterHanksFX

Read more: TSLA, Uber Stock Troubles Could Signal Shifting Tech Sentiment

DailyFX forecasts on a variety of currencies such as the US Dollar or the Euro are available from the DailyFX Trading Guides page. If you’re looking to improve your trading approach, check out Traits of Successful Traders. And if you’re looking for an introductory primer to the Forex market, check out our New to FX Guide.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES