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Morning Commentary

CHILLED AND CLICKED †

By Charles Payne, CEO & Principal Analyst
11/27/2023 9:38 AM

Friday’s short session was insightful in several ways, but mostly, there is upward bias even when mega-cap names are down.

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S&P 500 Map

Brick-and-Mortar retailers continued to rebound. It’s still notable (to me) how resolved Americans are when spending money. We will not be deterred.

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Black Friday

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Black Friday doesn’t have that same feeling it once did, which is excellent news for mall cops and security guards, who once upon a time risked their lives the day after Thanksgiving.

Still, there is a symbolism to the day. It will be used to measure the potential holiday spending demand.

One thing for sure is retailers were trying to lure folks off the sofa and into the stores. 

Significant discounting was expected, not just the gimmicky kind that is bait-and-switch.

Larger retailers have taken it on the chin lately, but small niche names like Ross Stores and department store Dillard’s have come on strong.

Look for the larger names to use their leverage with deep margins as consumers become more discerning about spending into the New Year.

 

We Stayed Home and Clicked

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I went to the mall, and it wasn't crazy, but it wasn’t like past years.  Meanwhile, Black Friday saw a record for online shopping at $9.8 billion against the consensus of $9.6 billion.

There are tons of stocks to watch, but I think eBay (EBAY) is an excellent proxy to see how the weekend translates to investors.

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And let's keep an eye on the brick-and-mortar – SPDR S&P Retail ETF (XRT) chart, which looks compelling after two major breakaway gap openings. There is room to run.

Today’s Session

It’s Cyber Monday, and Adobe sees $12.3 billion in spending. How much of that is influenced by inflation won’t be mentioned in headlines.  Moreover, I suspect a huge jump in credit card spending, as so-called excess savings runs to a trickle.

Aggregate personal savings versus the pre-pandemic trend

Meanwhile, keep an eye on Tesla, which has the largest short position in the market at $170 billion dollars.

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