Retail stocks are getting crushed

Retail stocks are under pressure on Wednesday after Target announced it was slashing its guidance as a result of "disappointing traffic and sales trends."

The big box retailer says sales fell 1.3% in the crucial holiday period and now expects fourth-quarter earnings per share of $1.45 to $1.55, lower than its previous outlook of $1.55 to $1.75.

While shares of Target are down about 4.6% following the announcement, other retailers are also coming under pressure. Kohl's and Macy's trade lower by 4.2% and 3.4%, respectively, as they too recently announced disappointing holiday sales. At least part of the problem facing big department stores is Amazon's recent dominance in the clothing space.