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Navigating Black Friday

by LLB Finance Reporter
23rd Nov 23 12:17 pm

As the holiday season approaches, so does one of the most anticipated shopping events of the year – Black Friday.

Traditionally recognised as the day after Thanksgiving in the United States, Black Friday has evolved into a global shopping phenomenon, offering consumers great discounts and deals.

How do Retail Stocks perform against the market over Black Friday?

Research from XTB’s team of market analysts highlights the importance of Black Friday in the performance of some of the world’s most famous retail brands and their stock market performance.

In data compiled over the last twenty years, XTB research shows that famous brands such as Abercrombie & Fitch, Macys and Nordstrom vastly outperform the stock market in both the run up to and period after the famous Black Friday sales.

In the 16 days before Black Friday, research shows Abercrombie & Fitch emerged as one of the top-performing retail stocks, boasting a return of 7.66%. This is closely followed by Macy’s, exhibiting a return of 4.99%, and Nordstrom, with a return of 4.37% with all three retail stocks vastly outperforming the S&P 500 over the same period which rose on average just 0.7%.

Interestingly when comparing the performance of the same retail stocks over both the 16 days prior to Black Friday and the 15 days after the famous sales day combined, the aforementioned gains noted above were retained.

What are the top 10 retail performing stocks?

The top 10 performing retail stocks in the 16 days running up to and 15 days after Black Friday for the last twenty years are as follows:

  • Abercrombie & Fitch 7.66%
  • Macy’s 4.99%
  • Nordstrom 4.37%
  • Tapestry 4.26%
  • American Eagle Outfitters 4.19%
  • PVH Corp 3.73%
  • Capri Holdings 3.11%
  • Ralph Lauren 3.03%
  • Kohl’s 2.62%
  • Ross Stores 2.62%
  • SP500 0.72%

Please be aware that information and research based on historical data or performance does not guarantee future performance or results. Past performance is not necessarily indicative of future results, and any person acting on this information does so entirely at their own risk.

Why might these retail stocks be popular around Black Friday?

As evident from the research conducted above, individuals eagerly anticipate Black Friday deals to purchase Christmas gifts and essential items but it seems that anticipation is not restricted merely to retail goods but the financial markets as well.

The research noted above shows that the shares of famous retail brands are in high demand with investors buying shares in Abercrombie & Fitch, Macy’s and Nordstrom in expectation of a strong performance over Black Friday.

That’s why the data shows much of their average stock market performance gains happen in the 16 days prior to Black Friday, as opposed to after. So investors are likely buying shares expecting a profitable sales period over Black Friday.

Interestingly, most retail brands hold onto their pre Black Friday stock market gains after the sales day has happened, indicating that investor moves are not temporary in nature and the gains may – whilst rising most before Black Friday – are not merely based on adrenaline.

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