Consumer discretionary stocks have shown mixed performance in recent months, prompting investors to consider selling. For instance, the Vanguard Consumer Discretionary ETF has only seen a modest 3% increase year-to-date, compared to the Nasdaq’s 19% rally and the S&P 500’s 14.5% rise.
Factors such as high interest rates and lingering inflation have deterred consumer spending on non-essential items. The U.S. Federal Reserve’s reluctance to cut interest rates further adds to the pressure on consumers.
Given the current economic climate, there are certain consumer discretionary stocks that investors may want to avoid in July. One such stock is Etsy (ETSY), a company known for its online marketplace.
Another company to consider selling is Royal Caribbean Cruises (RCL), which has been significantly impacted by the global COVID-19 pandemic. While the company has shown signs of recovery in recent years, potential natural disasters like Hurricane Beryl could pose a threat to its operations.
Ultimately, investors should carefully evaluate their consumer discretionary holdings in light of current market conditions to make informed decisions about selling.