The US retail market has seen a $50bn market share drop as nervous high street retailers prepared for an underwhelming Black Friday. Individual retailers such as Target, Kohl's, TJX, Ross Stores and L Brands all lost around 10% in valuation, while Gap further stoked market fears by revealing they were considering shuttering some its stores.
In the lead up to Black Friday, many retailers have been offering incentives to better compete with their online rivals, particularly Amazon. Target announced plans to offer free two-day shipping to customers until Christmas, regardless of whether they are members or not. Yet, the company's shares still fell by 12% on Tuesday.
While high street retailers such as Kohl's, which has performed better than expected, many were still hit by the share slump. Kohl's yearly net sales amounted to $4.369bn, which was marginally higher than analyst predictions of $4.365, marking its fifth consecutive quarter of positive growth. However, this did little to boost the company's share price.
Other than the near complete dominance of Amazon, experts have blamed the increasingly tighter US labor market for the slump, with everything from wages and freight costs continuing to rise, and profit margins continue to narrow. However, as a lot of market activity being fueled by fear, the public will have to wait to really gauge how well or poorly retailers performed at the end of the holiday season.