Why Retail Stocks Were Slipping Today

Shares of retail stocks were falling again on Wednesday as the specter of a recession spooked investors once again. A number of economic data points pushed stocks lower, including a weak ADP payroll report for September. That followed a report on Tuesday from the Institute of Supply Management that showed manufacturing activity contracting for the second month in a row, hitting a 10-year low. Both reports added to fears of a potential recession and a trade war with China.

Retail stocks, already among the most vulnerable on the market, took a hit since they are sensitive to consumer spending and macroeconomics, especially heading into the holiday season, the most important time of the year for the industry.

On a day when the S&P 500 lost 1.8%, the SPDR S&P Retail ETF (NYSEMKT: XRT) gave up 2.8%. Among individual retail stocks, some notable losers were Best Buy (NYSE: BBY), which lost 4.3%; Macy's (NYSE: M), down 5.8%; Kohl's (NYSE: KSS), which gave up 5.7%; Nordstrom (NYSE: JWN), which closed down 5%; and Michaels Companies (NASDAQ: MIK), which fell 10.7%.