Shoppers open up their wallets on the first shopping weekend of the holiday retail season

Too early to call it a trend, but the retail shopping numbers over the Thanksgiving weekend that traditionally kicks off the holiday shopping season were encouraging to those of us projecting a decent 2% or so increase in retail sales this year.

The average U.S. shopper spent 6.4% more this year than last over the Thanksgiving weekend, according to the National Retail Federation. The average of the 212 million shoppers at stores and websites over the weekend spent $365. Online sales made up one-third of the total. U.S retail sales over the weekend came to an estimated $45 billion.

The National Retail Federation is projecting a 2.3% gain in retail sales to $447 billion this year during the holiday shopping period. Read more

Dollar rallies while the euro stumbles: Which is good for some stocks

The U.S. dollar keeps running higher as the euro stumbles.

With financial markets unconvinced that the Irish bailout will put an end to a euro debt crisis that’s ready to engulf Portugal and Spain, the U.S. Dollar Index (DXY) pushed above 81 this morning for the first time since September 21. (The U.S. Dollar Index tracks the dollar against a basket of currencies that includes the euro, yen pound, Canadian dollar, Swiss Franc, and Swedish krona.) The dollar index had moved above 86 in June after beginning the year near 74.

The euro, on the other hand, has moved below support and has in fact dropped below its 200-day moving average as investors drove the yields for bonds in Spain, Portugal, Belgium, Italy, and Hungry—as well a Ireland—up this morning. The British pound has also dropped below its technical support at its 200-day moving average on news that the country will contribute to the Irish bailout, even though the United Kingdom does not belong to the euro block. That served just to remind the financial markets of the big exposure of U.K. banks to the Irish crisis. I’m sure it didn’t help either that the U.K. government lowered its forecast for GDP growth for 2011.

There’s plenty of U.S. news this week to confirm—or reverse–these currency trends. Read more

Should you be getting your portfolio ready for Christmas?

If you’re like a lot of us, you’ve noticed that the stocks to own in this rally were things: commodity producers and the companies that made machinery for commodity producers. Brazilian iron ore miner Vale (VALE) was up 23% from the August 26 low to the October 29 close. Copper and gold producer Freeport McMoRan (FCX) was up 41% in the same period. Mining equipment maker Joy Global (JOYG) was up 32%.

I’m not urging you to dump those stocks out of your portfolio now. I think they should continue to do well in the fourth quarter as growth in the world’s developing economies drives demand for physical commodities and as a declining U.S. dollar and rising fears of U.S. inflation drive demand for commodities stocks.

But I do think it’s time to see how far your portfolio has drifted (Like Mae West: “I was Snow White but I drifted.”) toward an excessive allocation to a sector that is, whatever its prospects, more expensive than it was two months ago. And to add a few positions in a sector that has been largely overlooked in this rally and that is likely to do surprisingly well this quarter.

I mean retail.

This is retail’s time of year for lots and lots of volatility. The holiday shopping season is the time when retail stocks do really, really badly—if expectations are high and actual results are disappointing. And it’s the time when retail stocks do really, really well—if expectations are low and the actual results are surprisingly strong.

And that’s where I think we are this year. Read more

Plastic staying home alone this holiday shopping season

Shoppers are leaving home without it this year.

An estimated 28.3% of consumers will use credit cards to pay for holiday gifts this year, according to a survey by the National Retail Federation and BIGresearch. That would be a drop from the 31.5% of consumers who paid with credit cards during the 2008 holiday season. Read more

Is the New Frugality just hype?

Jimmy Choo—well, his iconic Sex-in-the-City shoes anyway—is now on the war-torn economic frontline. So is Stella McCartney. Anna Sui. And, of course, McDonald’s.

The battle is over the New Frugality, the current marketing hot button as the United States gradually emerges from the Great Recession.

Is the New Frugality simply marketing fluff, a way to get consumers to feel good about spending themselves into debt again?

Or does it mark a real change in the zeitgeist? Will consumers start counting pennies and calculating value in a way that shifts the power of the brands that rule the global economy?

Companies from Procter & Gamble to Wall-Mart to Louis Vuitton desperately want to know.

The battle comes to an H&M near you on November 14. Read more