Consumers Binge Despite Higher Interest Rates, And The Fed Watches Them Nervously

Retail sales in March increased by 0.7% seasonally adjusted, with a year-over-year jump of 4.0%. Total retail sales jumped 10.1% in March from February to $712 billion. Ecommerce, food services, and general merchandise retailers were the biggest drivers of growth.

U.S. Retail Sales Rack Up Solid March Numbers

U.S. Retail sales smashed expectations in March, with total sales up 0.7% and ex-autos up 1.1%. Non-store retailers and bars and restaurants saw the biggest year/year increase. Five out of the 10 consumer-related industries have turned positive. The latest retail sales data reflects strong consumer buying.

U.S. Household Spending Holds Firm

Retail sales beat all expectations. US retail sales rose a very robust 0.7% month-on-month in March versus 0.4% expected. With jobs, inflation, and activity all beating expectations, the Federal Reserve is in no position to cut interest rates. We expect spending and inflation to slow, but the Fed won't be contemplating rate cuts.

Weekly Report: what happened at VDC last week (0408-0412)?

Top quant-rated consumer staples during Q1

Consumer Staples Select Sector SPDR Fund ETF (XLP) gained 4.8% in Q1. The consumer staples sector has been the worst-performing sector in the S&P 500 over the last year. The sector is considered less susceptible to economic cycles than the broader market.

Weekly Report: what happened at VDC last week (0401-0405)?

XLP: Expensive With Underperformance Risk

Consumer staples are resilient in the face of economic uncertainty. The consumer staples sector is a hedge for investors during volatile markets. The XLP is expensive at 22x PE with 7% EPS growth for the S&P 500. With low growth, high valuations, and few positive catalysts, the XLP may underperform the market.

How The Pieces Add Up: VDC Targets $218

Weekly Report: what happened at VDC last week (0325-0329)?

Resurging Corporate Profits Show Inflationary Pressures Are Reheating After Lull: Corporate Profits By Major Industry

Home Market Outlook Economy Analysis Resurging Corporate Profits Show Inflationary Pressures Are Reheating After Lull. Corporate pre-tax profits in all non-financial domestic industries combined jumped by 5.6% in Q4 from Q3. The spike in profitability in inflationary times is a sign that companies hiked prices much faster than their costs.

Predictions of a Steady Fed & Pullback? ETFs Capturing Attention

Weekly Report: what happened at VDC last week (0318-0322)?

Should You Invest in the iShares U.S. Consumer Staples ETF (IYK)?

Should You Invest in the Vanguard Consumer Staples ETF (VDC)?

Watching For A Weakening Consumer

The consumer accounts for nearly 70% of U.S. GDP. Since September of last year the overall level of retail sales has stalled. Credit card debt has increased significantly since the pandemic ended. Charge-offs and delinquency in credit card debt is reaching levels seen at the start of prior recessions. The elevated charge-off rate may be a canary in the coal mine.

Weekly Report: what happened at VDC last week (0311-0315)?

Should You Invest in the Fidelity MSCI Consumer Staples Index ETF (FSTA)?

Weekly Report: what happened at VDC last week (0304-0308)?

Should You Invest in the Invesco S&P 500 Equal Weight Consumer Staples ETF (RSPS)?

Notable ETF Outflow Detected - VDC, PM, MDLZ, MO