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American Apparel Shares Soar as Retail Gains

Vertical retailer’s stock recover ground lost since founder Dov Charney’s suspension.

American Apparel Inc.’s shares rose 15 cents, or 28.7 percent, to 68 cents as U.S. retail stocks returned to winning form.

The S&P 500 Retailing Industry Group rose 0.4 percent to 890.01, slightly better than the Dow Jones Industrial Average’s 0.3 percent advance to 16,867.51 but not quite up to the 0.5 percent pick-up registered by the S&P 500, which ended the day at 1,959.53.

The largest gain by far among the retail, fashion and beauty issues tracked by WWD came from American Apparel as ousted founder Dov Charney, who retained 27.2 percent of the company’s shares, filed for arbitration in his dispute with the firm. The rise essentially erased the 14-cent decline in shares on Tuesday.

Christopher & Banks Corp. logged the second biggest gain among the WWD sample, rising 9.8 percent to $9.04, while Hanesbrands Inc. shares added 9.2 percent, to close at $96.72, after disclosing that it had reached an agreement to acquire DBApparel, the French underwear firm.

Declines included Cache Inc.’s 3.2 percent drop to $1.53 and Movado Group Inc.’s 3 percent decline to $41.92.

European stock markets closed on a down note on Wednesday, with the CAC 40 in Paris leading the retreat.

The French market slipped 1.3 percent to 4,460.60, followed by the FTSE 100 in London and the FTSE MIB in Milan, which both fell 0.8 percent to 6,733.62 and 21,469.10, respectively. The DAX in Frankfurt dipped 0.7 percent to 9,867.75.

Retail and luxury stocks were mostly down, with exceptions including Carrefour SA, up 2 percent to 26.88 euros; Mulberry Group, up 1.7 percent to 7.38 pounds; Metro AG, 1.5 percent to 31.67 euros and Moncler, 1.4 percent to 12.10 euros.

Among the stocks that fell the most were Gemfields, 3.9 percent to 49 pence; Boohoo.com, 2.3 percent to 44 pence; Asos.com, 2.1 percent to 28.42 pounds; Koovs, 1.8 percent to 1.40 pounds, and Marks & Spencer Group, 1.8 percent to 4.26 pounds.

The euro traded at $1.36 against the U.S. dollar while the pound fetched $1.70 and the Swiss franc equaled $1.12.