NEW YORK — Buying just may be coming back into fashion.
This story first appeared in the July 30, 2002 issue of WWD. Subscribe Today.
Apparel retailers and manufacturers were part of the markets’ stampede Monday, even though Wal-Mart and Target reported below-plan sales for last week. The Dow Jones Industrial Average, posting the third-largest point gain in its history, shot up 447.49 points, or 5.4 percent, to 8.711.88. Last Wednesday the Dow jumped 488.95 points, or 6.4 percent. Since last Tuesday’s close of 7,702.34, the Blue Chips have rebounded 13.1 percent. Still, the index is off 5.7 percent so far this month.
The Standard & Poor’s retail index advanced 12.84 points, or 4.6 percent, to end the day at 289.78.
Specialty stores posted the most impressive gains, outshining the overall markets and other retailers. Those seeing more robust advances in their share prices included Urban Outfitters charging up, $3.53, or 13.8 percent, to $29.10; Ann Taylor, $2.75, or 11.2 percent, to $27.30; Burlington Coat Factory, $2.11, or 11.3 percent, to $20.81; Chico’s, $3.59, or 11.1 percent, to $36.09; Pacific Sunwear, $1.81, or 9.5 percent, to $20.90; Gap, $1.05, or 8.6 percent, to $13.25; Buckle, $1.89, or 8.1 percent, to $25.24; Talbots, $2.31, or 7.8 percent, to $31.82; American Eagle, $1.31, or 7.5 percent, to $18.76; and Abercrombie & Fitch, $1.70, or 7.1 percent, to $25.60.
Department stores brightening during the week’s first trading session included Nordstrom, up $1.44, or 7.8 percent, to $19.85; Saks, 75 cents, or 7 percent, to $11.42; Dillard’s $1.66, or 7 percent, to $25.41; May Co., $1.85, or 6.3 percent, to $31.11; and J.C. Penney, $1.07, or 6.1 percent, to $18.62. In the discount world, shares of Target climbed $2.29, or 6.9 percent, to $35.29, while Wal-Mart saw a $1.35, or 2.8 percent, increase, to close at $49.53.
Vendors seeing the strongest gains in the price of their shares were LVMH, up 92 cents, or 11.3 percent, to $9.10; Coach, $2.82, or 12.9 percent, to $24.72; Jones Apparel, $2.26, or 7.1 percent, to $34.26; and Polo Ralph Lauren, $1, or 5 percent, to $20.90.
The S&P 500 jumped 46.12 points, or 5.4 percent, to 898.96, while the Nasdaq pushed ahead 73.13 points, or 5.8 percent, to 1,335.25. European financial markets were also strong Monday, posting across-the-board increases. Shares in the UK FTSE 100 jumped a collective 4.6 percent, or 186.10 points, to close at 4,202.70.
Workers struck several Wal-Mart stores in Germany last Friday and Saturday, though no stores were closed. The strike was instigated by Ver.di, Germany’s service union, which is trying to pressure Wal-Mart to join the German Employer’s Federation, which the union negotiates with on salaries and other issues on behalf of retail workers. Ver.di said Monday that it would continue to call for strikes at Wal-Mart stores in Germany, at as of yet unspecified dates, until Wal-Mart joins the Federation. There are 95 Wal-Marts in Germany.
Sales for the overall company slid below plan last week, though Wal-Mart said it would still hit the lower end of its July comparable-store sales plan for a 5 to 7 percent uptick. On a recorded call, the firm attributed some of the weakness to strong year-ago sales driven by the distribution of income tax rebate checks.
J.C. Penney said its department stores should comp down 2 to 4 percent in July, in line with its original expectations. Last week, Penney’s said it was tracking toward a 2 percent decline. Federated Department Stores Inc. continues to expect its same-store sales to be flat to slightly down in July, and Target said comps in its discount stores came in below plan due to weakness in its men’s wear and gardening areas.