May 25, 2022, 7:44 pm EDT
Rebound from Retailer
It is a rebound day for retailers after a nearly one-month decline. Nordstrom Inc (JWN) +14%, Gap Inc (GPS) +12%, Kohl’s Corp (KSS) +12%, and Best Buy (BBY) +9% represented this beaten-down industry with a fight-back.
However, its fate is still to be determined by consumers for months to come. One day wonder does not mean the rally is in the process. The key is whether consumers are willing to spend money on discretionary items like clothing, shoes, and other items out of high inflation conditions.
The major indexes rose but without outstanding volume. Thus, we do not consider this as the short-term bottom or reversal. It is simply a rebound.
Nvidia Corp (NVDA) is down about -7% in the extended trading hours after the earnings report. Thus, the future trend is still muddy for the technology or semiconductor industry.
The big picture remains the same bears are still in charge with the weapons of inflation, balance sheet reduction, higher rates, and a slowdown in consumer spending. There will be no surprise that the downtrend will resume when the rebound is over.