Shares of Macy's plunged by 14 percent on Wednesday after the company issued disappointing guidance. But overall retail sales are expected to be strong, with the National Retail Federation forecasting an increase of 3.7 percent over last year in November and December, above the 10-year average of 2.5 percent.
For investors, exchange-traded funds allow investors to easily diversify their exposure and avoid single-stock risk, but choosing which retail ETF to buy makes a big difference. Case in point: The Market Vectors Retail ETF (RTH | A-79) is up 6.6 percent this year, while the SPDR S&P Retail ETF (XRT | A-51) is down 6.7 percent.
YTD Returns For RTH, XRT
RTH's large exposure to the surging online retail juggernaut Amazon.com has served it well this year, while XRT's exposure to smaller-cap stocks through its equal-weighting scheme has been a negative.
With people increasingly doing their holiday shopping online, RTH's exposure to Amazon may allow it to continue to outperform.
More of a winter play than a holiday play, natural gas is one market that usually sees an uptick during this time of the year. The fuel―primarily used for heating and cooling needs―always sees its demand peak during the winter months.
Because the risks of a frigid winter could send inventories to critically low levels, natural gas often commands premium pricing in the coldest months of the year: December, January and February.
However, that historical pattern has been turned on its head this year, with prices close to decade-lows heading into winter. That's because, much like the oil market, the natural gas market is flooded with supplies from prolific U.S. shale wells.
Stockpiles hit a record high last week, according to the Energy Information Administration. Making matters worse, the winter cold has been late to arrive for the Eastern half of the country.