Eye on the Street: Retailers & Katrina
The Katrina debacle and soaring energy prices will crimp consumer spending.Albeit not recessionary, be prepared for a downturn.
Retailers were under great selling pressure during Thursday trading.
Spikes in gas and oil have dampened some economist's growth outlooks for the US -- they are projecting 3.5 growth instead of their earlier 4.5% in the current July-Sept quarter.
The deadly storm should also affect the Fed's interest rate hiking streak, as well as the employment number, which currently sits at 5% .
I like how Costco is holding up well -- I guess fear of a second cataclysm is forcing people to stock up on basic goods.
Whole Foods -- which we have a Hold Rating on although the stock is a bit pricey -- is also weathering the storm better than its counterparts.
Teen retailers are getting clobbered today; stay away from the Gap.
Forget back to school; we're going long on "back to normal" post-storm reconstruction with a block purchase of Caterpillar (CAT), which is looking ferocious at a new 52 week high today.
Apparently, marionette Mother Nature has the Dow on a puppet string.
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