According to IBM's 2019 Retail Forecast, gains will be spread across categories such as health and personal care, clothing, pharmacies and restaurants.

As retailers and fashion brands race to the finish line of the holiday shopping season, the coming year is shaping up to be one with slightly more challenges than 2018.

Economists and retail analysts peering in their crystal balls said in research notes this week that several macroeconomic factors will likely make year-over-year, top-line comparisons more difficult in 2019. Dana Telsey, principal at Telsey Advisory Group, said in her stock-pick report that there was a “lack of clarity” in the coming year, which follows the “restrained optimism” of this past year.

In a breathlessly paced recap of retail share performance this year, Telsey said consumer stocks have “endured dramatic volatility over the past year, with the S&P 500 Consumer Discretionary Index heading straight up nearly 10 percent by late January (on top of being up over 20 percent in 2017), before a sharp decline to essentially flat year-to-date by early April, followed by a solid surge to a new peak of up 20 percent year-to-date in late September, followed by a steep decline since then to up only 1 percent year-to-date (versus the broader S&P 500 Index down about 5 percent year-to-date,” she noted.

“The recent pressure on the stocks can be explained by more uncertainty about the outlook for 2019, despite the still solid U.S. consumer,” Telsey said, adding that some of the headwinds looming include the impact of higher interest rates, “moderating housing fundamentals,” higher labor and freight costs, and bloated inventory positions due to tariff heading, among other issues. Telsey and her team of analysts also said the global economic view shows that “many foreign economies appear to be slowing” while “geopolitical uncertainty has increased around the globe.”

For her part, Telsey sees a strong labor market, low gas prices and improved tax rates as tailwinds to consumer spending. But, with more headwinds than tailwinds entering 2019, “forthcoming sales and earnings guidance for the year ahead may be more muted,” Telsey said. “For the stocks to reaccelerate, more clarity of the roadmap ahead seems to be needed, along with increases in operating profit dollars and margin, to push the stocks higher. We anticipate a clearer path to be in focus by the March time period, as the direction of interest rates and other macro drivers should be better understood.”

From an investment perspective, Telsey suggests “looking for consumer stocks that have more defensive characteristics and/or idiosyncratic drivers of sales and profit.” Her top stock picks for 2019 include PVH, Nike, Target Corp., Walmart, Kohl’s and Amazon, among others.

In a separate report from IHS Markit, economists at the firm see global economic growth decelerating to 3 percent from a prior forecast of 3.2 percent.

IHS Markit chief economist Nariman Behravesh said that policy missteps “remain the biggest threats to global growth in 2019 and beyond.”

“Simmering trade conflicts are dangerous, not because they have done damage so far — they haven’t — but because they could easily escalate,” Behravesh explained. “At the same time, the sell-off in equity and commodity markets, on top of the gradual removal of stimuli by some central banks, means that financial conditions worldwide are tightening. The good news is that the probability of a single policy event seriously hurting global growth in 2019 is still relatively low.”

IHS Markit expects the U.S. economy to show a growth gain of 2.6 percent in 2019, which is lower than the 2.9 percent growth rate for 2018. Still, the firm described this as “indicative of solid economic fundamentals.”

The firm cited tightening credit conditions and higher tariffs as well as a rising dollar as economic headwinds with comparatively low-interest rates and cheap oil prices as tailwinds.

Across all retail sectors, IBM’s 2019 Retail Forecast is calling for “broad-based strength” next year with an overall increase of 3.04 percent. “Gains will be spread across categories including health and personal care, clothing, pharmacies and restaurants,” researchers at IBM said.

Sales could be impacted by the tailwinds of strong employment, continued economic growth and low gas prices; and the headwinds of lower new home sales and rising interest rates: making it a great time for retailers to selectively increase promotions and more carefully manage slow-moving items,” IBM said in the report.

After crunching the data and creating a predictive sales model, researchers at IBM see women’s apparel showing a year-over-year increase of 2.66 percent in 2019 while men’s will swell 3.23 percent.

“In addition, traditional retailers as a group are expected to see sales continue to increase via their online platforms,” authors of the IBM report said. “Simultaneous growth in both online and offline channels indicates that merchants are not only investing in their digital platforms, they are also finding new ways to draw shoppers into stores: for example, by changing store layouts and offering products not available online.”

With online sales, Euromonitor International recently launched retailing data that included cross-border commerce. The firm’s analysis found that spending on cross-border transactions “accounted for roughly 10 percent of total global e-commerce in 2018. This is expected to increase to 12 percent in 2023. The fastest-growing countries over the next five years in absolute terms will be China, France and Canada, respectively.”