The Brexit's Impact On Consumer Confidence

Stifel Softlines Retail analyst Richard Jaffe considered the group as a whole. The analyst discussed topics such as back to school, seasonally warmer weather and the Brexit's impact on an always-important component of retail spending, consumer confidence.

Jaffae highlighted "significant uncertainty" amid the UK's decision to leave the European Union.

"Apparel stocks have come under pressure due to concern that the upheaval associated with UK’s departure will cause British and European consumers to further pull back on spending, likely prolonging already weak retail sales," Jaffe said in a research note Wednesday morning.

He showed concern for tourist-centric US stores like Macy's, Inc. (NYSE: M) and Coach Inc (NYSE: COH) as "a strong U.S. dollar will likely continue to keep foreign tourists out of the US."

On the other side of the spectrum, Jaffe pointed to "the majority of our stocks under coverage as being relatively insulated from the macro implications as most of their revenues are derived in the US."

Jaffe specifically mentioned Abercrombie & Fitch Co. (NYSE: ANF) and TJX Companies Inc (NYSE: TJX) as two retailers with that insulation.

"We believe the sell-off is resulting in some quality retail stocks seeming oversold," the Stifel analyst suggested. "While both names have UK and European exposure, we believe the recent sell-off is overdone."

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