What's going on?

Retail giant Walmart posted better-than-expected quarterly earnings on Tuesday, as American shoppers took their newfound government-funded shopping habits in stride.

What does this mean?

Walmart�s sales jumped 6% last quarter compared to the same time last year � much more than the 2% increase analysts were anticipating. As for why, take your pick: it might�ve been the extra spending encouraged by the $2,000 stimulus checks, the extra market share Walmart poached from its grocery competitors during the pandemic, or simply the pent-up demand of a post-lockdown customer. Speaking of which, the sorts of products shoppers were buying shifted too: teeth whitener was a particular hot-seller, as newly unmasked customers prepared to flash their pearly whites once more.

Needless to say, all this spending is making Walmart feel pretty upbeat about the future: the retailer�s now gone from predicting a slight drop-off in earnings for the year to a �high single-digit percentage� rise.

Why should I care?

For markets: Ecommerce isn�t going anywhere.

Walmart likewise saw its ecommerce sales increase by 37% compared to the same time last year, even though online sales growth had been expected to decelerate as shoppers headed back into stores. That�ll come as a relief to Walmart: the company�s making moves to improve its ecommerce efforts by opening up its online marketplace to non-US vendors, in hopes it�ll tap into China�s vast network of manufacturers and close the gap with archrival Amazon.

Zooming out: Fashion is back in fashion.�

Ecommerce expansion isn�t Walmart�s only new venture: it�s now buying a virtual fitting room business in an effort to sell more fashion-forward apparel. And it might be onto something: fresh US retail data shows that sales of clothing and accessories in April surged 727% from the year before (tweet this). That�s certainly gone down well at department store Macy�s, which reported a surprise profit on Tuesday and upped its forecast for the rest of the year.