Even as Retail Exceeds Expectations, Stocks Fall


Author: Jeffrey Taylor

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The stock market is still feeling the effects of Covid-19. Despite the recovery of various sectors, including retail, industry leaders are struggling to prevent stocks from plummeting.

Despite record highs and retail surges, the Nasdaq still fell over 1%. This loss was primarily the result of tech stocks that have been underperforming in February.

Retail sales surged over 4%, which was was well above the expected figure in January. Economists had predicted a rise of 1.1%, while the final figure rests at 5.3%.

Various factors are contributing to this, the least of which is the $600 stimulus check that was sent out.

The check saw an increase in the number of people spending in retail. So, naturally, it’s expected for sales to fall back down in the wake of this.

However, should Congress distribute the $1400 or $2000 stimulus checks, you should expect retail to surge even higher than it did in January.

Bitcoin Rises Amidst Stock Uncertainty 

One of the biggest economic challenges that Covid-19 brought about was uncertainty. The impact that the virus has had on the operations of businesses around the globe is still being speculated on a full year after the initial arrival of it.

This uncertainty has caused growing fear and unrest in many stock investors, leading to a migration of funds from traditional stocks into Bitcoin.

Seeing as how the cryptocurrency recently smashed its all-time high, reaching upwards of $50,000, it’s not unnatural for the stock market to take a negative hit as a result.

As more investors take their gains earned from this Bitcoin surge, it’s possible that the Nasdaq and S&P 500 are going to feel the benefits of the inflow of cash.

The Dow is Still Strong

Despite the struggles of the Nasdaq and S&P 500, the DOW has set a fresh record during February.

This deviation only serves to highlight the volatility that the economy is currently facing. However, with economic recovery and stimulus checks on the way, it’s likely that 2021 is going to be better for the United States than 2020.

The Global Economy

While the US economy is on the rise, the same cannot be said for the rest of the world. The United Kingdom has set a record low year-on-year GDP with a decrease of 9%, while European nations like Spain see even worse results with an 11% decrease in output.

Where the Stock Market Goes from Here

It’s difficult to predict where the stock market goes from here. Economists are hopeful, especially given that retail sales surpassed their expectations.

However, caution is always being advised in these times. Covid-19 has the stock market playing by its rules, so investors are advised to be wary in their dealings.

While tech hasn’t been doing well in February, it’s likely that the industry is going to bounce back as we move further into 2021.

Travel companies continue to take losses despite the relative stabilization that many of them have faced. It’s unlikely that this bleeding is going to stop any time soon, but it seems like the worst is over for the industry.

In general, cautious optimism seems to be the mood on Wall Street. The worst of things has been overcome, and many believe that a period of economic recovery is on the way. However, only time can tell if the economy is going to bounce back truly.

BWCEvent aspires to share balanced and credible details on cryptocurrency, finance, trading, and stocks. Yet, we refrain from giving financial suggestions, urging users to engage in personal research and meticulous verification.


Jeffrey Taylor is a retired mechanical engineer who has an interest in all things financial, including emerging markets and cryptocurrencies.