Retail stocks inched up 0.1 percent Wednesday, but Wall Street posted a modest decline as investors tried to shrug off an unexpected contraction in the U.S. economy.
The nation’s gross domestic product fell at an annual rate of 0.1 percent in the fourth quarter, down from 3.1 percent growth in the third quarter, according the Commerce Department’s advance estimate. Economists projected a 1.2 percent gain in gpd.
Nigel Gault, chief U.S. economist at IHS Global Insight, said the report was not as bad as it looked on the surface and that the decline was driven by “temporary corrections in defense spending and inventories.” Defense spending fell by 22.2 percent.
Gault described the drop as “payback” for a strong third quarter and noted that consumer spending growth rose to 2.2 percent from 1.6 percent.
The S&P 500 Retailing Industry Group increased 0.66 points to 702.86, as the Dow Jones Industrial Average slid 0.3 percent, or 44 points, to 13,910.42. Among the retail gainers were Amazon.com Inc., up 4.8 percent to $272.76; Tiffany & Co., 1 percent to $65.19; American Eagle Outfitters Inc., 0.9 percent to $20.39, and Ross Stores Inc., 0.8 percent to $59.88.
In Europe, markets edged down at the close of trading, with the FTSE MIB in Milan leading the way.
The Italian market fell 3.4 percent to 17,282.87, while the CAC 40 in Paris and the DAX in Frankfurt both sank 0.5 percent, to 3,765.52 and 7,811.31, respectively. The FTSE 100 in London declined 0.3 percent to 6,323.11.
The euro traded at $1.35 against the dollar while the pound traded at $1.57 and the Swiss franc went for $1.08.
Among the day’s biggest gainers were Luxottica Group, which was up 2.3 percent to 34.36 euros after logging a record year with 2012 sales of 7.08 billion euros, or $9.06 billion, up 13.9 percent.
Other stocks on the rise included Mulberry Group, which advanced 3.7 percent to 12.07 pounds, and Inditex, which was up 2.5 percent to 105.65.
Among the stocks that fell were Tod’s, off 1.3 percent; Geox, 4.1 percent to 2.60 euros, and the Swatch Group, 2.1 percent to 84.75.