Retail relief rally picks up after the CPI report shows consumers may be finally getting a break

The retail sector is in rally mode on Tuesday after the October inflation report calmed fears of higher interest rates for longer, and indicated that consumers are seeing some relief in key categories. The October Consumer Price Index came in at 0.0% M/M compared to the +0.1% expected level and +0.4% prior month reading. At the same time, core CPI, which excludes food and energy arrived at +0.2% M/M versus the predicted +0.3% level and +0.3% prior month point. Of note for households, the food at home category only showed a 2.1% year-over-year increase.

The SPDR S&P Retail ETF (NYSEARCA:XRT) was up 4.40% at 9:52 a.m. to outpace the broad market. The big gain for the retail sector came even as companies continue to warn on 2024 macroeconomic headwinds.

Notable gainers across the retail sector included Big Lots (BIG) +14.75%, Stitch Fix (SFIX) +13.55%, Farfetch (FTCH) +12.88%, Wayfair (W) +10.37%, Vroom (VRM) +9.59%, Sweetgreen (SG) +8.57%, Arhaus (ARHS) +8.15%, Chewy (CHWY) +7.42%, VF Corp. (VFC) +6.88%, Caesars Entertainment (CZR) +6.28%, Norwegian Cruise Line Holdings (NCLH) +6.10%, e.l.f. Beauty (ELF) +5.49%, Bath & Body Works (BBWI) +5.35%, and Etsy (ETSY) +5.25%.

Home Depot (HD) was up 5.15% after earnings and took up peer Lowe’s (LOW) +4.15% along with it. Meanwhile, Target (TGT) ripped 4.47% higher just ahead of the retailer’s earnings report due out on Wednesday and Best Buy (BBY) shot up 4.25% a week ahead of its trip to the earnings confessional. The retail relief rally also helped Amazon (AMZN) push 2.79% higher in morning trading.


Source: Breaking News on Seeking Alpha

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