STOCK WATCH: Pandemics and Elections and Inflation, Oh My!

Natasha Sholl By Natasha Sholl | 17 May 2022

The E-Commerce Index has experienced a surprise lift in the last week, driven by Temple & Webster’s performance on the ASX.

The last few months have seen the ASX Listed E-Commerce Index plummet. The pandemic and associated supply chain issues—as well as the natural shift away from online as Australia reopened—caused online retail stocks to feel the pinch (to put it lightly). Add to that, concerns about the election and its aftermath, inflation and a global crisis or two, and it’s clear that online retail is imploding.

What’s interesting however is that in the last week, the E-Commerce Index actually outperformed the ASX200. As at close of ASX on Monday, the E-Com Index was actually up 5.7%, compared to the ASX200 which was down 0.1%. This surge is mainly driven by Temple & Webster, up 11.1% over seven days. Earlier in May, Temple & Webster shares sank, after its announcement that it was entering the home improvement market, a venture that Management flagged would be loss-making for several years. That reaction was short-lived, and Temple & Webster stocks seem to be making an impressive recovery.

Similarly, after dismal performance on the ASX after its quarterly business update, Kogan shares also experienced some uplift in the last week, now +6% to $3.66. We can see a similar pattern with Booktopia. Its share price plummeted after the announcement that CEO Tony Nash would be handing over the reins (combined with reporting of its Q3 performance) however this now seems to have stabilised. We’re not seeing growth (yet) but, down 2.5%, it’s a shift compared to the hammering it was getting. Cettire is another stock that investors seems to be abandoning in droves. Like Kogan, it’s now up in the last week. At $0.50, that’s 2.1% growth over seven days. Redbubble, too, is up 3.5% in the same period, and MyDeal is stagnant at 0%.

Source: Performance based on ASX reporting

BikeExchange is the worst performer on the ASX, down 15.6% in the last week to just $0.04. This time last year, it was above $0.20. Adore Beauty is also down, a 4.8% loss over seven days to $1.30 at close of ASX on Monday.

As we head into the Election weekend, it will be interesting to see how that impacts ASX performance and whether investors enter the next few months with a renewed sense of optimism and confidence or a continued sense of caution and despair.

Figures are current as at close of ASX on 16 May 2022. This is analysis only and not intended as investment advice.

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