We've got some signs today that make me feel as if the retail business is going to lead us higher, specifically the branded plays such as VF Corp (VFC), PVH (PVH) and Ralph Lauren (RL). I know that J.C. Penney (JCP) spoke positively about the branded portfolio. These companies have also been able to navigate Europe, and cotton has collapsed.
But the most important characteristic of these players is that they are not cheap. Their stuff is more expensive than most of the clothing out there, whether it be the Hilfiger, the North Face or the Polo label.
When I see these stocks up, it always makes me think that the gloom we all hear everywhere is misplaced. These stocks should be cut in half, if things are as horrible as people say.
There are other strange positives out there, too. I know the transports stubbornly refuse to have a big day, but International Paper (IP), which makes container board, a terrific lead indicator of shipping, is breaking out on the strength of price increases that are sticking.
On any given day, this market gives you something to hang your hat on. Today we have expensive retail, container board and the best techs.
No wonder they can't take the thing down big. Not with that kind of leadership.