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Retail Stocks Lose a Point on Weak Earnings

Markets react to disappointing results from Urban Outfitters, TJX Cos. and Dick’s.

Retail stocks pulled back a full 1 percent as a stream of weak first-quarter earnings results added to concern about consumer spending.

The S&P 500 Retailing Industry Group finished the day at 844.82 and suffered deeper losses than the Dow Jones Industrial Average, off 0.8 percent to 16,374.31, and the S&P 500, down 0.7 percent to 1,872.83.

Among U.S.-based retail stocks tracked by WWD, the four largest declines came from companies that had disappointed Wall Street with financial results within the last 24 hours. Dick’s Sporting Goods Inc. lost the most ground, selling off 18 percent to close at $43.60 after it reduced its full-year guidance in the wake of a first quarter in which earnings were up but below consensus estimates because of weakness in its golf and hunting divisions.

After reporting lower-than-expected first-quarter earnings late Monday as its namesake brand continued to struggle, shares of Urban Outfitters Inc. dropped 8.8 percent, to $32.98, for the second biggest decline in the WWD retail sample. Stage Stores Inc.’s losses widened, prompting an 8.3 percent decline in shares to $17.80, and The TJX Cos. Inc. saw its shares recede 7.6 percent to $53.95 after a rare earnings miss accompanied by a 1 percent same-store sales advance, below analysts’ expectations.

Among a quartet of fashion, retail and apparel shares with gains, the leader was Cache Inc., up 6.6 percent to $1.78; followed by Amazon.com Inc., up 1.5 percent to $301.19; Aéropostale Inc., up 0.9 percent to $4.54, and The Procter & Gamble Co., up 0.4 percent to $80.23.

The U.S. results followed a generally down day in Europe, despite a 0.3 percent advance to 20,387.07 by the FTSE MIB in Milan.
The FTSE 100 in London lost the most ground, sinking 0.6 percent to 6,802.00, followed by the CAC 40 in Paris, down 0.4 percent to 4,452.35, and the DAX in Frankfurt, off 0.2 percent to 9,639.08.

Those with gains included Italian clothing manufacturer Aeffe, which spiked 11.4 percent to 1.17 euros on continuing speculation that it might change hands. Asos.com rose 3.7 percent to 40.12 pounds, and Geox ascended 3.5 percent to 2.91 euros. Ted Baker was up 3.5 percent to 17.60 pounds, while Yoox Group advanced 6.3 percent to 22.22 euros.

Among those in retreat were Koovs, down 2.2 percent to 1.53 pounds; Tod’s, 2.8 percent to 98.65 euros; Metro AG, 1.9 percent to 28.83 euros, and Boohoo.com, 3.8 percent to 0.44 pounds.

The euro traded at $1.37 against the U.S. dollar, while the pound fetched $1.68, and the Swiss franc equaled $1.12.