Expectations of another cut to the Federal Reserve’s monthly bond buying program were realized late in the day, contributing to a broad decline on Wall Street that sent retail shares down 2 percent.
The S&P 500 Retailing Industry Group fell 17.76 points to 876.98, returning to its losing ways after an up day Tuesday that ended an eight-session losing streak. Retail declines were larger than those in the broader market, where the Dow Jones Industrial Average slid 1.2 percent to 15,738.79 and the S&P 500 was off 1 percent to 1,774.20.
In Ben Bernanke’s final meeting as chairman of the Federal Reserve, the Federal Open Market Committee, citing improved prospects for economic growth in the U.S., trimmed the Fed’s monthly stimulus program by another $10 billion to $65 billion beginning next month. Janet Yellen, currently vice chairman of the Fed, succeeds Bernanke as chairman on Friday.
U.S. markets started the day with the jitters — and European markets ended theirs with losses — as interest rates were raised in South Africa and Turkey to calm fears about their currencies.
Only a handful of U.S. fashion, beauty and retail issues tracked by WWD managed gains, with Coldwater Creek Inc., still in the midst of an exploration of strategic alternatives, rising the most, up 3.6 percent to 94 cents. Cache Inc. and Hanesbrands Inc. were the only other members of the WWD sample to advance more than 1 percent, with Cache up 1.5 percent to $4.70 and Hanesbrands up 1.4 percent to $65.07 in advance of its after-market report on fourth-quarter earnings, which came in 8 cents above analysts’ consensus estimates at 98 cents a share on an adjusted basis.
Hanesbrands also raised its 2014 guidance after boosting its quarterly dividend 50 percent, to 30 cents a share, on Tuesday.
Among those dragged down the most by Wednesday’s sell-off were American Apparel Inc., down 8.1 percent to 99 cents; Quiksilver Inc, down 7.3 percent to $6.98; Avon Products Inc., down 5.7 percent to $14.76, and Sears Holdings Corp., down 5.3 percent to $36.36. Other equities in the fashion and beauty sectors endured declines of less than 4 percent for the day.
Overseas, the DAX in Frankfurt was down 0.8 percent to 4,156.98, while the CAC 40 in Paris fell 0.7 percent to 4,156.98. The FTSE MIB in Milan dipped 0.6 percent to 19,337.42, while the FTSE 100 in London fell 0.4 percent to 6,544.28.
It was a mixed day for fashion, luxury and retail stocks. Mulberry’s shares closed down 23.8 percent to 7.05 pounds, after the British leather goods label issued a profit warning Wednesday. Yoox lost 3.1 percent to 28.01 euros, while Brunello Cucinelli was down 1.7 percent to 19.86 euros. British supermarket chain Sainsbury’s was among the FTSE 100’s biggest decliners, down 2.3 percent to 3.48 pounds, after the supermarket announced that its chief executive officer Justin King would resign in July.
Among the stocks on the rise were Asos.com, up 2.6 percent to 62.09 pounds; French Connection, which gained 4.1 percent to 37 pence and Aeffe, which rose 3.1 percent to 0.78 euros.
The pound traded for $1.66 against the U.S. dollar Wednesday, while the euro went for $1.37.
From overseeing America’s fastest-growing speciality retailers to codifying cool, WWD talked to the women who are leading the way for the future of beauty. Check out our Instagram Stories to see how these women built today and are creating tomorrow. (📸: @hannah_khymych) #wwdbeauty
For @laperlalingerie's spring 2018 show, the brand chose to host their event at @thevenetianmacao. With Chinese megastars @bingbing_fan and @hubing in attendance, La Perla debuted a rock ‘n’ roll-inspired collection. The show marked the start of Sands Macao Fashion Week, which runs from October 19 to 24 — the city’s first such event. Pictured here are models backstage with glimmering eyes. #wwdfashion (📷: Cheuk-Yin To)
Trending for spring 2018: top stitch design. Gone are the days of stitch just for seams — designers are using the once-minimal detail to create strong decorative elements. (📷: Paola Testa; Styled by @andrew_shang) #wwdfashion
@tradesy is turning the concept of a showroom upside down with its new space in Santa Monica. Here, the company plans to hold events, art exhibits and a showcase rare fashion pieces like this Louis Vuitton boxing set. Get all the details on Tradesy’s first showroom on WWD.com. #wwdnews
Spotted last night at the @erdem x @hm launch event: Kate Bosworth, Rashida Jones, Kirsten Dunst and Selma Blair. The party, which took place in LA, also marked the opening of their pop-up shop. “I was interested in creating a collection that wasn’t in any way disposable. It was about pieces you’d create and keep forever, things that have a permanence to it,” designer Erdem Moralioglu said. #wwdeye (📷: Katie Jones)
Renee Zellweger in yellow in 2001 and again in 2017. Chosen as one of the 12 @pantone Leading Spring Colors (and dubbed “Meadowlark”), it only makes sense that the bright hue stands the test of time and is making a resurgence this season, seen already on stars like @blakelively and @gigihadid. (📷: Donato Sardello & @rexfeatures) #wwdfashion #tbt
Dior’s 70th anniversary celebration continues with a new exhibition at the Royal Ontario Museum in Toronto. “Christian Dior,” which is scheduled to run through March 18, takes a look at the founders tenure from 1947 to 1057 and feature 40 designs. Pictured here is an evening gown from the Ailée, fall 1948-49 haute couture collection. #wwdfashion (📷: Brian Boyle)