Retailers reported slower sales in May, but don’t feel too bad for the sector. Sales at various chain stores were still up slightly from a year ago and analysts are predicting good things for the consumer discretionary sector this year.

One analyst at Goldman Sachs recommends a “full speed ahead” on consumer discretionary, reports Brendan Conway for The Wall Street Journal.

The analyst feels especially bullish on Macy’s (NYSE: ) and other domestic department stores, citing a broad sell-off as a result of the European debt crisis. All in all, retail may have been unfairly singled out as investors unloaded, the analyst says. []

Surprise, surprise: One sector that is expected to outperform in the long run this year is the luxury retail class. An analyst claims that the sector would outperform the MSCI World index this year thanks to strong demand from Chinese buyers, recovery in the United States and the weaker euro, reports Astrid Wendlandt for Reuters.

Watches and spirits sales will also get a boost, analysts say. And after a lagging 2009, one of the worst years on record, it could be a welcome turn of events. [.]

  • Vanguard Consumer Discretionary ETF (NYSEArca: )

  • Claymore/Robb Report Global Luxury (NYSEArca: )

Tisha Guerrero contributed to this article.

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