By Suzanne McGee and Bansari Mayur Kamdar
(Reuters) - Exchange-traded funds (ETFs) tracking U.S. retailers outpaced the broader stock market on Monday, with most posting gains amidst record holiday sales.
Shoppers and retailers spent record amounts on Black Friday and Cyber Monday - or the Friday and Monday after Thanksgiving - according to estimates from Adobe (NASDAQ:ADBE) Digital Insights, a division of Adobe Inc.. Friday's sales totaled $9.8 billion and Adobe forecast that retailers could pull in another $12.4 billion Monday from online sales.
The Amplify Online Retail ETF climbed 0.44% and the ProShares Online Retail ETF ended the regular trading session 0.39% higher. The broader VanEck Retail ETF gained 0.02%, and the SPDR S&P Retail (NYSE:XRT) ETF was the only one in the group to post declines. It fell 0.59%, giving up some of its gains from Friday.
The Amplify ETF's gains have been driven by top holdings like Affirm Holdings (NASDAQ:AFRM), up 11.97% on Monday and 97% so far in 2023. The VanEck Retail ETF's holdings include Costco (NASDAQ:COST),, which gained 0.6% Monday and is up more than 30% so far this year.
By contrast, the S&P 500 closed down 0.2%, while the Nasdaq Composite Index fell 0.1%.
Many ETFs are still well short of their 52-week highs, after a year in which higher interest rates led to doubts about consumer spending. For example, the SPDR S&P Retail ETF trades at $63.64, down from its year high of $75.77.
Forecasts from PwC and Deloitte that U.S. shoppers would finally surpass pre-pandemic holiday spending levels created a "positive outlook" that is "a welcome sign for retailers gearing up for the critical fourth-quarter sales period," said Michael Ashley Schulman, chief investment officer at Running Point Capital. "However, lingering anxiety remains around connecting with inflation-squeezed shoppers in a turbulent environment."