Below is a complimentary excerpt from a institutional research note written by Retail analyst Jeremy McLean. If you are an institutional investor interested in accessing our research email sales@hedgeye.com |
June retail sales were reported yesterday. Below is a commentary clip and data dump from our US Macro analyst Christian Drake. Our general take is that the previously weak categories (Clothing, Furnishings, Electronics, Auto) got better, but many remained negative. The stronger categories (Grocery, Building Materials, Nonstore retail) slowed, but remained elevated. Opening up of retail is spreading out the spending.
We’ll see how that trends in July when recovery and reopening appears to have stalled out.
Drake: More firms and establishments were open in June. The capacity for both production and commerce was higher and enhanced government transfers remained in place to support both activities. Perhaps that’s an overly simplistic way to “analyze” June conditions but I don’t think so. Against that backdrop, one would expect Retail Sales to show incremental improvement …
So, solid improvement to close 2Q, but certainly tenuous as we move past the main thrust of the twin tailwinds of stimulus + deferred demand. Again, and simplistically, the overarching risk is that the signaling value of any of the June data is left impotent given the reimplementation of lockdown measures into month-end across a significant swath of the population/GDP. Indeed, the weekly high-frequency data across surge metro’s (and in the aggregate) have almost universally rolled over in the past couple weeks and the next couple weeks promise more of the same. |
June retail sales were reported yesterday. Below is a commentary clip and data dump from our US Macro guru Christian Drake. Our general take is that the previously weak categories (Clothing, Furnishings, Electronics, Auto) got better, but many remained negative. The stronger categories (Grocery, Building Materials, Nonstore retail) slowed, but remained elevated. Opening up of retail is spreading out the spending. We’ll see how that trends in July when recovery and reopening appears to have stalled out.