The reelection of President Obama freed Wall Street to worry in earnest about the looming fiscal cliff as well as the euro zone crisis and the general global economic malaise.
The Dow Jones Industrial Average on Wednesday sank back below 13,000, falling 2.4 percent, or 312.95 points, to 12,932.73 as the S&P 500 Retailing Industry Group fared somewhat better, declining 1.5 percent, or 9.82 points, to 649.15.
Among the fashion and related companies getting hit the hardest were Tumi Holdings Inc., down 5.1 percent to $21.75; The Bon-Ton Stores Inc., 5 percent to $11.97; Elizabeth Arden Inc., 4.7 percent to $46.61; Tiffany & Co., 3.7 percent to $62.92, and Abercrombie & Fitch Co., 3.5 percent to $32.84.
Obama logged a decisive win in the electoral college, but still faces a divided legislative branch. Together the two sides will face automatic tax increases and spending cuts at the end of this year — what Federal Reserve chairman Ben S. Bernanke dubbed the “fiscal cliff.” Should the taxes kick in without modification, many see dire consequences for the U.S. economy, which is already limping along and being propped up by Fed debt purchases and ultralow interest rates.
“The political landscape has changed little after the elections,” said Nigel Gault, IHS Global Insight’s chief U.S. economist. “Some uncertainties, over health care reform and the Federal Reserve, have been cleared up by President Obama’s reelection. But crucial uncertainties over fiscal policy remain just as severe as before.”
Gault noted the Obama victory means his health care program will stay in place and that there won’t be big changes at the Fed.
“But the key uncertainties over the future of fiscal policy remain in place,” he said. “Divided government, as before, could be a recipe for complete gridlock.”
Markets were also down in Europe, where investors were closely watching the U.S. election.
Milan’s FTSE MIB fell 2.5 percent to 15,291.78, as Frankfurt’s DAX declined 2 percent to 7,232.83, Paris’ CAC 40 dropped 2 percent to 3,409.59, and London’s FTSE 100 retreated 1.6 percent to 5,791.63.
The decliners included Burberry Group, down 2.8 percent to 12.17 pounds, or $19.45 at current exchange; LVMH Moët Hennessy Louis Vuitton, 2.4 percent to 125.90 euros, or $160.73; Marks and Spencer Group plc, down 2 percent to 3.91 pounds, or $6.25, and PPR, 1.8 percent to 134.20 euros, or $171.33.
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews
“Stranger Things” is getting a new cast member for season 2. Meet @sadiesink_, the 15-year-old who will be joining the Netflix series for its new season. You may recognize her from “The Glass Castle” with Brie Larson and Woody Harrelson, but the Texas native’s next role goes in an entirely different direction. She describes her character, Max, as “a rough and tumble skater girl [who] becomes friends with the boys at school.” The second season debuts on October 27. (📷: @jgreenery) #wwdeye
Amid the Harvey Weinstein controversy, there’s another sector that’s being put under the spotlight for sexual abuse: the modeling industry. While rumors about abuse and sexual harassment of female and male models — and the photographers, agents and others who perpetrated it — have circulated within the fashion world for years, model @cameronrussell started posting stories from models on Instagram last week about abusive situations they’ve encountered — from sexual harassment and molestation to attempted rape. Over 75 have weighed in so far. Read more on WWD.com. Link in bio. #wwdnews
To celebrate its 16th anniversary, @dylanscandybar tapped designers and celebrities to create mosaics out of candy. The mosaics will be auctioned off to support the philanthropic cause of each participant’s choice. Pictured here is the mural created by @aliceandolivia's Stacey Bendet. For a first look at some of the other artwork being unveiled tonight, go to WWD.com. #wwdeye
The annual Veuve Clicquot Polo Classic in Pacific Palisades this weekend drew Kate Hudson, Tracee Ellis Ross, Laura Dern and more. See pictures of the star-studded event on WWD.com. (📷: @chelsealaurenla) #wwdeye
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye
"Nowadays when life is not so happy with everything going on in the world, I think people come to me for a little bit of whimsy and color and fun." - Designer Rebecca De Ravenel on her cult-favorite jewelry line. (📸 : @vsteves) #wwd40
“Everyone is talking about how the retail industry is struggling, but I think it’s an incredible time because brands who are doing something different and innovative are setting themselves up for the future,” said @adamgoldston, who founded the luxury athletic brand @apl with his brother @ryangoldsten. The Goldston’s are part of WWD’s 40 under 40: a group of industry notables. See the rest of the list on WWD.com. (📷: @vsteves) #wwd40
@eyeswoon blogger Athena Calderone debuted her first-ever cookbook, “Cook Beautiful,” which is heavily centered on the presentation and visual expression of food. Pictured here are her miso glazed carrots from the book. Get the recipe on WWD.com. (📷: @johnny_miller_) #wwdeye