Shares of Abercrombie & Fitch Co. shot up today on a report that the retailer hired Goldman Sachs to contend with an activist investor.
The stock rose as much as 7.8 percent and closed up 5.4 percent to $37.92 after CNBC reported the investment bank was retained help Abercrombie work with Relational Investors.
Abercrombie has stumbled lately. It is trimming back its U.S. door count and has said its newer stores overseas are hurting its more established flagships. San Diego-based Relational is led by Ralph Whitworth and, according to its Web site, “seeks to produce superior returns by using its combination of capital and experience to influence the direction of its portfolio companies.”
Relational owns 3.2 million shares of Abercrombie, or 3.8 percent of the company. Neither Abercrombie nor Relational commented replied to WWD’s request for comment. Goldman declined to comment.
Overall, it was an up day for the sector. The S&P Retail Index was up 0.3 percent, or 1.94 points, to 656 as trading settled. The Dow Jones Industrial Average rose just 9.99 points to 13,33.35.
Also gaining ground were Sears Holdings Corp., up 7.7 percent to $60.90 as it prepares to spin off its Hometown and Outlet stores; The Bon-Ton Stores Inc., 5.1 percent to $14.72; Kohl's Corp., 3.4 percent to $53.77, and American Eagle Outfitters, 3.3 percent to $23.46.
In Europe, most markets most markets gained after Germany’s Constitutional Court gave its approval to the euro zone’s permanent rescue fund.
Their decision will allow Germany’s president to sign into law the European Stability Mechanism, which will help to shore up the euro and save struggling countries. Nearly 40,000 Germans had signed a petition asking it to block the fund and instead submit the plan to a referendum.
The FTSE MIB in Milan climbed 1.2 percent to 16,419.79, followed by the DAX in Frankfurt, which was up 0.5 percent to 7,343.53, and the CAC 40 in Paris, which gained 0.2 percent to 3,543.79.
London’s FTSE 100 slipped 0.2 percent to 5,782.08.
Among the stock gaining ground were Marcolin, up 2.4 percent to 4.15 euros; Geox, 2.5 percent to 2.32 euros, and Mulberry Group, 1.8 percent to 13.24 pounds.
Losing ground were Inditex, down 3 percent to 86.70 euros; Compagnie Financiere Richemont, 2.4 percent to 59.40 Swiss francs. Burberry Group fell 1.5 percent to 10.72 after a profit warning pushed it down 21 percent Tuesday.
The euro traded at $1.28 while the pound traded at $1.60 against the dollar and the Swiss franc traded at $1.06.
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