Investors including George Soros’s family office and David Einhorn have bought tentative stakes in traditional US retailers, in early signs of a contrarian bet on the beleaguered sector as it battles against the onslaught of Amazon.

Several US retailers that have seen their valuations slide on concerns about the threat of online competition have surged in value since the start of the year. Shares in Target have gained 15 per cent while JC Penney are up by 28 per cent, outpacing a 2 per cent gain for the S&P 500.

David Einhorn’s Greenlight Capital purchased a small position in JC Penney of about 2 per cent of its shares in the fourth quarter, according to US regulatory filings, while Soros Fund Management took a small stake in Target. Element Capital, another hedge fund, opened a starter position in Macy’s.