Retail stocks are under pressure as a pivotal week of earnings approaches for the sector, with investors growing more cautious regarding the consumer landscape and trends in discretionary spending. The SPDR S&P Retail ETF has encountered a decline surpassing 6% this week, representing its fourth consecutive weekly decrease and its most notable weekly performance setback since October 2025. Weakness has been notably concentrated in entities like National Vision Holdings.

Kohl’s, Sally Beauty, and Advance Auto Parts have all recorded declines exceeding ten percent throughout the week. Larger retailers including Carvana, O’Reilly Automotive, TJX, and Amazon.com have faced declines this week as investors reassess the spending outlook. Economic data offered scant comfort: Retail sales (excluding automobiles) rose by 0.7% in April, a slowdown from the 1.9% increase recorded in March.

Next week could provide a conclusive understanding of the condition of the US consumer, with reports expected from significant retailers like Home Depot. Target, Walmart, TJX, BJ’s, Ralph Lauren, and VF Corp are included in this discussion, among others.