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Amazon's stock is not looking too hot ahead of Black Friday

Brian Sozzi

Amazon’s stock price hints it may not be a supremely merry holiday season for the internet beast. Merry, but not the holiday extravaganza that Amazon (AMZN) perma bulls always expect.

The relative price of Amazon’s stock versus the S&P 500 continues to deteriorate and is now hovering the lows of the year, points out Renaissance Macro strategist Jeff deGraaf. That’s somewhat bizarre considering the broader risk in retail stocks lately.

For starters, deGraaf astutely notes that the percentage of retail stocks in the S&P 500 Discretionary Index trading with a 20-day moving average above their 65-day moving average has climbed to over 80%. Not too shabby.

Meanwhile, Amazon’s stock has trailed both the S&P 500 and Dow Jones Industrial Average since late September. Said another way, Amazon’s stock hasn’t participated pretty much at all in the rally that has enveloped Wall Street since the summer. And lastly, shares of Amazon rivals Target (TGT) and Walmart (WMT) are near record highs — Amazon’s stock is off about 15% from its 52-week high.

FILE- In this Sept. 4, 2018, file photo a Nasdaq employee monitors market activity in New York. Investors were ravenous for companies able to add customers and deliver fat growth. So they were willing to pay premium prices for an Amazon or a Netflix. Left behind were stocks in more staid industries, even if they had more attractive prices relative to their profits. (AP Photo/Mark Lennihan, File)
A Nasdaq employee monitors market activity in New York. (AP Photo/Mark Lennihan, File)

Traders on Wall Street say Amazon’s out of the norm stock move could only suggest one thing — it won’t dominate the holiday shopping season as other retailers have upped their digital and same-day delivery games. Some also fret over the sums of money Amazon is now spending to boost its same-day delivery capabilities.

“The improving trends and momentum in retail suggests this holiday season may be positive for a vast majority of discretionary stocks and not just Amazon,” says deGraaf.

AdvisorShares CEO Noah Hamman said on Yahoo Finance’s The First Trade that he continues to be impressed by Walmart’s efforts to reclaim market share from Amazon. To be sure, that was on full display in Walmart’s third quarter earnings on Thursday.

Walmart U.S. same-store sales rose 3.2% in the quarter versus estimates for 3.1%. E-commerce sales spiked 41%, an acceleration from the 37% growth rate seen in the second quarter.

Brian Sozzi is an editor-at-large and co-anchor of The First Trade at Yahoo Finance. Follow him on Twitter @BrianSozzi

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