In recent times, there has been a historic shift in the US stock market, where investors are rotating from tech stocks to other lagging sectors in the market, but consumer staples have not been able to take advantage of this shift. Since reaching its peak on July 10th, the consumer staples sector has declined by 6.9%, whereas other sectors have performed better, with the S&P 500 Industrials sector rising by 3.5% and even more than 18% for the S&P 500 Equal Weighted Index, while the S&P 500 Consumer Staples sub-sector has only risen by 1.5%, lagging behind the S&P 500 Equal Weighted Index. The reason for the poor performance of the consumer staples sector can be found in the uneven performance of companies during this quarter's financial reports.

Since its peak on July 10th,$Nasdaq Composite Index (.IXIC.US)$Other sectors have performed better during this period, with the S&P 500 Industrials sector rising by 3.5%.$Spdr Series Trust S&P Regional Bkg Etf (KRE.US)$In contrast, the S&P 500 Consumer Staples sub-sector has only risen by 1.5%, lagging behind the S&P 500 Equal Weighted Index.

The reason for the poor performance of the consumer staples sector can be found in the uneven performance of companies during this quarter's financial reports.

Althoughcoca-cola (KO.US) While some companies have demonstrated exceptional pricing power and excellent results, the quarterly reports of other companies have been mixed, particularly those affected by concerns about the US consumer's situation.

The performance of consumer staples stocks is in decline.

For example, the global food giant Nestle announced on Thursday that its Q2 results showed an organic growth rate of 2.2%, up from a contraction of 2.0% in Q1, with sales recovery being relatively widespread across all business sectors and regions.

However, investors are more concerned about the company's pricing power. Although prices rose by 0.6% YoY in Q2, the rate of increase slowed significantly from the 3.4% in the previous quarter. Nestle also downgraded its full-year organic sales growth expectations from "about 4%" to "at least 3%", citing the faster than expected decline in prices. As a result, Nestle's stock traded on the Swiss exchange fell by 5.1%.

"The weather is good today The weather is good today."

The CEO of Nestle said during the earnings call: Low-income groups in North America and other parts of the world face pressure, so people are looking for value for money and promotions are particularly strong.

Similarly, Kimberly-Clark, which produces Scott tissue, announced its Q2 results this week. The company's organic sales in Q2 increased by 4% YoY, but this growth rate was lower than the analysts' expected 5.1%. In addition, the CEO of Kimberly-Clark said during the conference call that the US promotional environment had recovered to pre-pandemic levels.$Kimberly-Clark (KMB.US)$Some companies, however, have reported more positive news. Coca-Cola's performance was particularly impressive, with organic sales growth of 15% in Q2, and North American sales only falling by 1%. The company's product mix has average price increases of 9% across regions, exceeding analysts' expectations of 8%, with North American prices increasing by 11%. This suggests that the company is better able to raise prices in a cautious consumer environment than its peers, reflecting its brand strength.

Previously, it was reported that North American beverage sales had fallen by 3%, and revenue from this department had only increased by 1%, showing weaker pricing power.

While 60% of stocks rose this year,$PepsiCo (PEP.US)$Coca-Cola's stock price remained stable after the earnings release on Tuesday but has steadily risen this week, hitting a new historic high on Friday.

Overall, the pricing power of the US essential consumer goods industry varies, particularly since low-income US consumers have become tired of high prices, which has weakened the sector's traditional defensive position in investment portfolios to some extent.

Editor/ping