Today the market appeared to shift markedly away from the, heavily traded tech stocks and long-time market leaders to a more diverse basket. Oils were up (VLO, CVX) significantly and retailing rose as well from their down trodden pandemic positions (ROST, SKT).
Oils are not going away in the short run. The transition will persist, but it will take a long time. While the number of electric vehicles is increasing, the EV percent of total vehicles is small. People are creatures of habit and habits are slow to change, especially with the current cost of new vehicles. The historically high prices of vehicles in the used car market is evidence of the huge demand for used vehicles which are more likely gas powered.
While we are currently sequestered as a result of this pandemic, people will eventually get back out to the stores. Shopping is an experience, or, at least an escape, from our homes. People need interaction. Did you ever wonder why prisons use solitary confinement?!
We've spent months closely tied to our computers. Like George Bailey in a Wonderful Life, we’ve had the opportunity to see life from a different vantage. Few people would enjoy spending ALL their time on the computer making every purchase with little human interaction. This has never been clearer than the present.
Life is always about balance. Retail will always include bricks and mortar alongside on-line vendors. Market growth is likely to be from the retailers who provide long-term value and/or excellent experiences. Costco is a prime example.
While I don’t know about everyone else, when this pandemic clears up, I am ready to get out and about.
Time to be patient with quality holdings. Good things come to those who wait.
Be smart, be well-read, be well-rounded and be successful!
