Southridge Capital On Strong Gains In Retail And Marketing Sectors
Since the marketing sector has seen strong gains, Southridge Capital has been doing some research. According to the chair of the Institute for Supply Management™ Manufacturing Business Survey Committee, Norbert J. Ore: “The manufacturing sector grew for the eighth consecutive month during March”.
The PMI has indicated that the rate of growth is the fastest since July 2004. Mr. Ore also stated that out of the 17 industries tracked; only Plastics & Rubber had a contraction last month.
These positive results are being registered while inflation is kept in check. Southridge Capital is encouraged that the economy is still seeing positive growth.
In recent reports the retail market has shown strong gains for 5 weeks in a row. Increased sales have been witnessed by all major retail groups.
Since consumer spirits are up in concern to the economy, they tend to allocate more money to there spending. Hence, you see the gains in these sectors. Over the last 2 years, companies waited for consumers to open there wallets, but some could no longer wait. We can remember some of the bigger companies that fell victim to this: Filene’s Basement, Chrysler, Fortunoff, GM, Eddie Bauer and Circuit City all filed Chapter 11 during this time frame. It is our feeling that consumers are finally turning the corner.
One example of a company that was able to hold its own during the recession and should do better as the economy turns is Mattel’s Barbie doll. U.S. Barbie dolls sales, increased for the fourth consecutive quarter, and in the fourth quarter of 2009.
Also on the global stage they have seen a 3% increase in sales. Mattel, Inc., (NASDAQ:MAT) has been researching whether there would be a demand for a computer engineer Barbie Doll. The Barbie has amassed over 125 different looks and is sitting at 52 week high. This is a good sign that consumers have the extra spendable cash to keep the Barbie Doll alive.
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