Retail stocks under pressure amid weak earnings reports

Yahoo Finance's Emily McCormick examines how retail stocks are faring in this week's volatility and weak earnings season.

Video Transcript

SEANA SMITH: The retail sector is in focus after a string of weak earnings reports. And there's more selling today. Emily McCormick is here with a breakdown. And Emily, this has certainly been a sector that has really fallen out of favor with investors.

EMILY MCCORMICK: It certainly has, Seana. But if we take a look here at the Yahoo Finance Interactive Retail Intraday Board, we can see that there is quite a bit more green on the screen, compared to what we saw yesterday. Now, of course, Walmart and Target are two of the exceptions here. These are still definitely in sharply negative territory, both on an intraday basis and over the course of the week to date so far.

We could see Target shares are down 30%, more than 30%, since Friday's close. Now, of course, this company had also posted its worst single day decline since 1987 just yesterday. So really extending those losses into today's session. And a similar story here when we take a look at shares of Walmart, which is also down for the week today by 19.4%.

Now, I do want to highlight some of the exceptions here. Kohl's is one of the big ones. Now, this retail giant did report earnings results before the bell today. These shares are actually popping, even though Kohl's was also, like Target and Walmart, cutting its profit guidance for the full year, but on the top line, it said that it expected to see a comparable same store sales improvement in the back half of the year, even though it did post a year over year comparable same store sales decline for the first quarter. So a little bit of good news, perhaps investors taking this not as bad as feared. And as a result, we are seeing these shares up about 4% on an intraday basis.

SEANA SMITH: And Emily, you mentioned the fact that retail, I guess broadly speaking, is doing slightly better than what we have seen over the last couple of days, although that's still not really saying much. But I also want to bring up tech because this is another sector that is seeing some buying, not certainly anything compared to the excitement that we saw not too long ago. But we do see some green on the screen.

EMILY MCCORMICK: That's right. And there are a couple of pockets of green that I want to highlight, specifically Amazon being one of them. Now we saw this company really come under pressure yesterday. It is one of those tech giants that has that retail component, that consumer discretionary component of it.

We are seeing a little bit of a rebound today, although, of course, if we look on a year to date basis, still seeing quite a bit of pressure for this stock and for the other megacap tech giants. But again, a similar story to what we saw in retail, where, when we look on an equal weight basis, a much better picture than what we had yesterday with a majority of the NASDAQ 100 components now in positive territory today.

SEANA SMITH: All right, Emily McCormick, thanks so much.