Checking Retail's Springtime Setup

Retail sales figures for March are set to be released on Friday, and the question on many people's minds is, what is the state of retail? I have not been bullish on the retail sector, given my concerns over shrinking consumer savings and pressured disposable income. Whether it's the expiration of the payroll tax holiday, the impact of higher food and gasoline prices or the continued shrinkage in the employment participation rate, the combination makes me cautious when it comes to the consumer.

My recommended strategy last year was to look for what I call "guilty pleasure" stocks -- chocolate and coffee in particular, in the form of Hershey (HSY), Mondelez International (MDLZ) and Starbucks (SBUX). Other goods that have inelastic demand include tobacco, in the form of Reynolds American (RAI) and Altria (MO), and alcohol, which can be had in the spirits company Beam (BEAM) as well as the beer companies Molson Coors (TAP) and Anheuser-Busch (BUD).  ...294 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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