Investors continue to be concerned by the possibility of a slowdown in growth due to continued inflationary pressure and the return of COVID-19 case. Surprisingly, however, August saw an increase in retail sales. The retail stock performance should be driven by a better-than-usual expectation of holiday sales. So, it could be wise to invest in quality retail stocks Industria de Diseño Textil (IDEXY), Shoe Carnival (NASDAQ:), and Tilly’s (NYSE:) that have gained momentum and are well-positioned to maintain the same.Investors’ concerns over the pace of economic recovery due to the resurgence of COVID-19 cases have kept the market volatile. Consumer confidence fell to its lowest level in seven months in September. The already elevated inflationary climate is further complicated by severe supply disruptions and shipping delays in the United States. Jerome Powell (Federal Reserve Chairman) expressed concerns about inflation and predicted that the current levels of pressure will persist into 2022.

Retail sales rose 0.7% to 0.8% in August, compared with the expected 0.8% drop. The holiday season will likely drive higher sales than usual. This could make it worthwhile to look for retail stocks that are gaining momentum.

Retail stocks Industria de Diseño Textil, S.A. (IDEXY), Shoe Carnival (NYSE:), Inc. (SCVL), and Tilly’s, Inc. (TLYS) have been witnessing solid momentum over the past few months and are well-positioned to keep rallying in the upcoming months dodging the market volatility.

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