Black Friday Retail Stock Gains Sputter

Black Friday is one of the most important shopping days of the year for retailers. But investors weren’t bowled over by the weekend’s sales.

Stocks for many major retailers got a boost during shortened trading on Friday, but by Monday, most had pared their gains.

Walmart was a big winner on Black Friday. The retailer opened stores at 8pm on Thanksgiving for the first time. The company reported that this year’s Black Friday was its most successful.

Shares of WMT rose 1.9 percent on Friday, closing at $70.20. On Monday, the stock gave up those gains and was down 0.4 percent at the close.

Macy’s is another retailer that opened earlier than usual — at midnight — and saw strong sales. Shares were up 1.76 percent to $41.73 at the close on Friday. On Monday, they closed down 4.48 percent at $39.86.

Target saw its share price fall 2.6 percent on Monday after 1 percent increase on Black Friday.

Speaking to Reuters, Morningstar analyst Paul Swinand said investors view these two retailers as proxies for the larger economy.

While Black Friday was the story of the weekend, concerns over the fiscal cliff dominate investor outlook on spending and the economy. Some analysts say consumers are being more cautious with their money because the government has not reached a decision on taxes and benefits.

“If this drags on to Christmas Eve, there is a real possibility it could have negative consequences for the rest of the season,” National Retail Federation President Matt Shay told The Wall Street Journal.

This year’s Black Friday didn’t give give investors a clear idea of what to expect from holiday sales. Sales for the holiday weekend were up 13 percent to $59.1 million over last year, according to the National Retail Federation.

However, year-on-year growth in sales was better on Black Friday last year. Retailers increased sales 6.6 percent to $11.4 billion in 2011. This year, sales were $11.2 billion, down 1.8 percent, according to ShopperTrak. Growth in foot traffic at retail stores was also better last year — up 4.7 percent versus 3.5 percent growth this year.

But ShopperTrak said the results were skewed because a number of major retailers — including Wal-Mart, Target and Sears — launched Black Friday sales on Thanksgiving night. Essentially, shopping on Thursday evening robbed some sales from Black Friday.

While the media puts much emphasis on Black Friday, retailers still have some of their busiest shopping days ahead. Shawn Kravetz, president of Eplanade Capital told Reuters there is still more opportunity for gains.

“It’s sort of like the Super Bowl. The first couple of plays have been played, but we still do have a whole game ahead of us,” said Kravetz.

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