A Broad Look at Consumer Discretionary Stocks

The stock prices reign supreme. Everything else is just rhetoric. If the American economy is upwards of 70% consumer oriented, the health of said consumer is absolutely vital to the long term prospects for the market.

Here are the returns, year to date, of some of the bigger consumer discretionary stocks — broken down by sector.

Apparel

VFC -11%, UA -6%, HBI -16%, PVH +50%, RL -11%, LULU +5.5%, GIL -4%

Apparel has been tepid in 2016 — as a fickel consumer hops from one fashion to the next. One thing is constant, however, LULU continues to execute, while PVH surprises to the upside. They own the iZod brand and that’s been crushing this year.

Apparel Stores

ROST +21%, LB -20%, GPS +10%, FL +6%, JWN +9%, URBN +53%, AEO +13%, DSW -9%, ANF -40%

LB had some issues early on, while URBN nailed the trends. Overall, it’s truly a tale of two cities. If there’s one constant it is this: you’re either killing it with good fashion or getting the price points just right, like ROST, to attract buyers. Nothing unusual about the sector so far.

Department Stores

TJX +5%, M +4%, KSS -6%, JCP +29%, DDS -9%

Department stores have been plodding along — seemingly able to navigate a lethargic consumer. There was notable strength in JCP this year, still recovering from the harrowing Ron Johnson-Bill Ackman years.

Restaurants

MCD -2%, SBUX -11%, YUM +22%, CMG -17%, QSR +18%, DRI +3%, DPZ +39%, PNRA -2%, DNKN +22%, CBRL +12%, PZZA +41%, JACK +26%

While many of the smaller chains have done poorly, the larger names continue to shovel food into the fat, fucking, faces of the American pie gobbler. There was a noteworthy drop in the poisonous CMG, while DPZ and PZZA continue to deliver artery clogging pizza pies to American at a record pace. Also, DNKN gained on SBUX and JACK took share from CMG.

Sporting Goods

DKS +59%, CAB +32%, POOL +16%, VSTA -14%, SWHC +17%

Killer year for sporting goods, following the liquidation of Sports Authority. Gun sales are robust too, which helped CAB.

Auto Dealerships

KMX -5%, CPRT +41%, AN -19%, PAG +9%, LAD -10%, GPI -16%, ABG -18%

Car sales appear to be stagnating.

Specialty Retail

NFLX -13%, SHW +4.6%, LUX -28%, ULTA +40%, TSCO -22%, TIF -3.5%, SIG -34%, MIK +6.5%, SPLS -17%, BUFF +32%, BC -4%, BID +39%

Monster gains in ULTA. I hear they have the right mix. People love their pets, via BUFF. And the super rich appear to be collecting stuff again, via BID.

Home Furnishing

BBBY -16%, WSM -18%, RH -63%, HVT -16%, PIR -16%

Dreadful year for this sector. This is indicative of the stagnant home buyers market for the middle class. Rich people don’t buy stuff from BBBY or PIR. And,  while WSM might be expensive for middle class folks, it’s not exactly high end either. This is a really hard industry to invest in now, unless we see a big uptick in home sales.

Catalog/Mail Services

AMZN +21%, EBAY +15%, QVCA -31%, W -26%

Amazon and Ebay are executing. Everyone else gets executed.

Discount Stores

WMT +13%, COST -6.7%, TGT -5%, BURL +80%

Cheap stuff. Walmart is the cheapest grocery and random shit store, while BURL sells the cheapest clothes on the planet.

Apparel Footware and Accessories

NKE -17%, COH +10%,  KORS +17%, SKX -27%, WWW +35%, DECK +18%

Nike struggling, while FL stock is up? Something is off. This is a comeback year for COH, KORS and DECK.

Grocery

KR -25%, WFM -13%, CASY -3%, SFM -18%, CST +23%, WMK +25%, SVU -23%

This sector is beguiled by margin pressures. I am surprised to see KR get hit. Blame WMT.

Overall, the consumer is doing okay. There are some big winners out there and plenty of losers. Like most things in life, it all depends on your perspective. It’s performing like an economy growing at 2%. Enough said.

For a moment or two, I’ll make believe this shit actually means anything. I know a vast swath of you, in between swigs of cheap vodka, like to comb over thousands of charts, manually, like morons.

BEHOLD, as I do your job for you in 0.0000012631 of a second, via Exodus.

Here are my digitized charts, displaying stocks of interest now hovering around the 200 day moving average.

PSX, OI, PFE, MOH, WMT, GE, VZ, ORCL, HD, MCD, COST, TJX, CRM, DECK, GIS to name a few.

For the most part, the leadership of the market is intact — represented by the following basket of winners near their 52 week highs.

If the market is ever going to break lower, the above stocks will need to reverse and break down. Thus far, they’re moving sideways and basing out.

Let’s use some good olde fashioned logic this morning. If we are to believe the diabolical devils who operate the globalist movement for us are truly corrupt, then Trump has already lost. As a point in fact, Trump never had a chance. Agreed? Even if he had the most pristine character and never talked about grabbing pussy, he’d still lose the election — since the ‘establishment’ would never relent power.  Some of you will have a hard time dealing with this election loss, so you might as well begin to mourn now and not get your hopes up for a one in a billion outcome election win.

Having said that, very soon the election will be behind us and yours truly will have more to say about markets and how we might game them.

One has to assume a Hillary win is baked into markets, yes? If so, I don’t view the current pin action as a lurid display of optimism. If anything, the action in the healthcare sector, the last bastion of true growth in the market, has been dreadful. Stick  a pin in Hillary for the moment, however, because the overarching obsession is the direction of Federal Funds rates. Subsequently, commodity and forex markets have been jarred by the recent hawkishness. The dollar is at 5 month highs and gold has been harangued by sellers.

I am grateful for not being in the business of managing money now, for this tape is an abomination.

For me, the true story of 2016, post elections, will be the condition and spending habits of the consumer. The restaurant sector has been weak, which isn’t exactly comforting heading into the pagan holidays. How the hell are you playing this tape, from a macro perspective? Are there any thematic plays?

Speaking of which, I’ll be revealing my FIST OF DEATH this week — which are my top 5 short sales heading into year end. I see appreciable downside risk to the market, from a sundry of risks that aren’t even close to being priced in yet.

Fed’s Fischer will be giving a speech today — so keep an eye out for that.

It was only a matter of time before this happened. I’d expect Twitter to ban the Wikileaks account next.

It’s not a coincidence that following the Podesta emails, Julian Assange’s freedoms, in this case his internet access, would be revoked. I find it odd how this is even possible. Did Britain cut off internet access to the entire Ecuadorian embassy?

Julian Assange's internet link has been intentionally severed by a state party. We have activated the appropriate contingency plans.

— WikiLeaks (@wikileaks) October 17, 2016

Let’s not jump to conclusions and sensationalize rumors of Assange’s demise. But, thus far, nothing has been verified to the contrary. In fact, Donald Trump’s former campaign manager, Roger Stone, is tweeting out some crazy shit about the Ecuadorian Embassy being raided and their diplomatic status revoked. Obviously, Assange is a long term threat to the establishment. Clinton feels like she won the election already, so I don’t think they’re worried about the fall out of an Assange death or arrest.

Reports the Brits storm the Ecuadorian Embassy tonite while Kerry demands the UK revoke their diplomatic status so Assange can be seized

— Roger Stone (@RogerJStoneJr) October 17, 2016

John Kerry has threatened the Ecuadorian President with “grave consequences for Equador” if Assange is not silenced @StoneColdTruth

— Roger Stone (@RogerJStoneJr) October 17, 2016

Just before Wikileaks triggered the ‘Dead Man Keys’, John Podesta, who was a attending a Hillary Clinton ‘Victory Fund’ money raiser, starring worldclass chef Daniel Boulud, tweeted out this obnoxious asshole statement.

This is making the rounds right now, after the Wikileaks account tweeted out what seems to be encryption codes for secret documents. Assange had always said that if he were to die, ‘dead man keys’ would be triggered and a deluge of documents would be released.

What say you?

pre-commitment 3: UK FCO f33a6de5c627e3270ed3e02f62cd0c857467a780cf6123d2172d80d02a072f74

— WikiLeaks (@wikileaks) October 16, 2016

pre-commitment 2: Ecuador
eae5c9b064ed649ba468f0800abf8b56ae5cfe355b93b1ce90a1b92a48a9ab72

— WikiLeaks (@wikileaks) October 16, 2016

pre-commitment 1: John Kerry 4bb96075acadc3d80b5ac872874c3037a386f4f595fe99e687439aabd0219809

— WikiLeaks (@wikileaks) October 16, 2016

People are freaking out, worrying about his well being.

@shebamariba @BDWood73 @0HOUR1__ @wikileaks called “a dead man’s switch” just a precaution…but we can expect a bad day for John Kerry soon

— freakohealth (@JacquelynBaker8) October 16, 2016

This from the degenerates at 4 Chan

UPDATE: More from 4 Chan

UPDATE: Roger Stone just tweeted this out.

John Kerry has threatened the Ecuadorian President with “grave consequences for Equador” if Assange is not silenced @StoneColdTruth

— Roger Stone (@RogerJStoneJr) October 17, 2016

More from Stone:

Reports the Brits storm the Ecuadorian Embassy tonite while Kerry demands the UK revoke their diplomatic status so Assange can be seized

— Roger Stone (@RogerJStoneJr) October 17, 2016

Gingrich was interviewed by a monster today, discussing the vile and drunken nature of the media and how they’ve volunteered themselves to work at the behest of the Clinton campaign.

“This election is being rigged by the national media to suppress bad news about Clinton and maximize bad news about Trump.”

A great watch.

Out of all the emails leaked by Wikileaks, this one is the most alarming to me. This shows a lack of seriousness by the democrats in dealing with the very real threats facing Americans today. The fact that John curmudgeonly jested about the ethnicity of the killers, disappointed by the fact that they were muslim and not some white guy named “Chris”, told me all I needed to know about these people running the government.

They simply do not care. I realize that’s hard to believe for you die hard Podesta-Clinton groupies out there. You believe that, if you play your cards right, you too might be part of the elite cadre of blood sucking vampires. They don’t want you. They don’t need you. You are beneath them and shouldn’t be trusted to raise your own children — which is why they want to drug test them per annum.

DO NOT VIEW THE Podesta Emails yourself, for the government might arrest you for possessing illegal documents. Don’t you know, all of the news and information that you need can and should be provided to you by way of agitprop at CNN?

CNN falstely states that it unlawful for the public–but not for CNN–to search WikiLeaks #PodestaEmails pic.twitter.com/sZMoM9iT2i

— WikiLeaks (@wikileaks) October 16, 2016

Fuck the Kingdom of Saud. Monarchies are, inherently, the most oppressive and obnoxious form of government ever invented. These mountebanks force an otherwise forlorn populace into a life of repetitive supplication — hoping for scraps to be dropped off their gold mantles to sustain their miserable existences. The great riches of Saudi Arabia, blessed with unlimited amounts of oil, are continuously squandered by a perverted cadre of Princes who levy their positions into hedonistic displays of depravity.

Because they’ve been so very busy trying to foment theocratic barbarism, via the most oppressive religion ever concocted in the history of man, they’ve forgotten to diversify away from their core export: crude.

As such, with the drop in Brent and soured loans on the books of many of their banks, we’re entreated to the beginnings of what may become a cauldron of magnanimous fuckery — a SAIBOR driven liquidity crisis.

Interbank rates are on the rise, indicative of stress in the banking system, aka the checking accounts of the Saudi fucking Princes.

Debt has surged! A grande experiment in British banking, designed to enslave borrowers, continues to astound.

For the session, Saudi banks and insurance firms are getting lit.

Via Bloomberg.

Saudi Arabia will post a budget deficit of 13.5 percent of economic output this year, the highest since 1992, declining to 9.6 percent in 2017, according to forecasts from the International Monetary Fund. Amid the shortfall, direct local government debt climbed to $63 billion at the end of August from almost $38 billion at the end of 2015, according to information in the Saudi bond prospectus obtained by Bloomberg.

Rising Saibor rates reflect the “extent of the liquidity challenge in the banking system,” said Raza Agha, the London-based chief economist for the Middle East and Africa at VTB Capital Plc. “The outlook for government borrowing has risen sharply and even if next year’s deficit declines to perhaps 8 percent of gross domestic product, you’re still looking at deficit-financing needs of $56 billion.”

One could only hope for Brent to halve from current levels, in order to make their plight all the more interesting.