NEW YORK — Stocks rallied Monday as several big corporate acquisitions in the health care and electronics sectors quelled investor worries that the economy might be softening.
After steep declines Friday, retail stocks recovered 2 to 5 percent on Monday. Shares of Polo Ralph Lauren Corp. got an extra boost after the company raised revenue guidance, citing higher demand for its goods.
The S&P Retail Index climbed 2.3 percent to 427.37, while the broader S&P 500 closed up 1.7 percent, to 2,061.84. The Dow Jones Industrial Average rose 1.7 percent, to 11,051.05.
Shares of Polo Ralph Lauren ended the day up 15.4 percent at $55.27 on heavy volume. The company raised its first-quarter sales guidance on "stronger worldwide demand for its products with increased full-price sell-throughs both at the company's retail stores and at better department and specialty stores."
The company said it expects consolidated revenue growth to be in the mid-20s percentage range versus a year ago. Polo had previously forecast that percentage growth would range from the high teens to the low 20s. The company will address full-year guidance on Aug. 8, when it releases first-quarter results for the period ended July 3.
Virginia Genereux, analyst at Merrill Lynch, upgraded shares of Polo to "buy" and established a $62 price target. "Polo remains one of the few names in apparel with organic growth and margin expansion opportunity," she wrote. "We see 7 percent earnings accretion from eventual profitability at jeans and footwear (27 cents of earnings per share), assuming $300 million in wholesale revenues at a 15 percent operating margin."
In other corners of the retail sector, notable gains buoyed by the rally included: Bon-Ton Stores, up 8.3 percent to $25.22; Federated Department Stores, up 3.7 percent to $34.48; and Aéropostale, up 3.4 percent to $29.21. Dillard's closed the day up 3.6 percent to $29.90, despite a downgrade from Merrill Lynch analyst Stacy Turnof.
Turnof downgraded shares of Dillard's to "sell" from "neutral" in a research note issued during the afternoon trading session. Turnof said, "Given the strong performance of Dillard's and our concern about a consumer spending slowdown, we expect a reversal in performance in [the second half]." The analyst said there are "no major near-term catalysts to move stock to next level.""We believe that the Dillard's customer [moderate/upper moderate] should be pressured more than its peers if the economy slows," Turnof added.
@chanel and @pharrell dropped what’s being dubbed as the world’s most exclusive sneakers yesterday. The Adidas Originals NMD Hu, which Williams designed in collaboration with Chanel and @adidasoriginals, has a waiting list of over 120K people who pre-registered online at chanelatcolette.fr –– and only 500 pairs are on sale. The singer predicted the resale value of the shoes could reach $40K. Read the full interview on WWD.com. Link in bio. #wwdfashion (📷: Dominique Maître)
@imanshumpert is diving deeper into his creative endeavors and relaunching his clothing line, Post 90s, and is helping to raise money for the hurricane victims in St. Maarten with a jersey he’s designed with his brother. The Cleveland Cavaliers player talked to WWD about kneeling during the national anthem, working with fashion brands and how he wants to be more than an @nba player. Read the interview on WWD.com #wwdfashion (📷: George Chinese)
Not only does #TheProfit return to CNBC tonight, but @marcuslemonis has launched @shopmarcus, a new shopping and lifestyle retail experience in Aspen and Chicago, with more locations to come. The retail stores offer in-store stylists and a variety of contemporary womenswear selections.
“It’s life, I’m going to face it,” @mingxi11 sighed. “I fell, but you know, I think the most important thing is that I get back up. I had the love, the help from my sister — the girl next to me Gizele [Oliveira] — she’s so nice. When I went backstage everybody was trying to comfort me like ‘Oh Ming, it’s OK.’ I’m really, really touched. I think it’s them who gave me the courage to go back on stage for the finale,” Xi told WWD of her fall at the @victoriassecret fashion show. (📷: David Fisher) #wwdfashion #vsfashionshow #victoriassecret
@louisvuitton tapped @therealpeterlindbergh for its latest city-centric photo book, which is part of a series called Fashion Eye. The primarily black and white book captures the spirit of Berlin in 57 images shot between 1989 and 2019. “Berlin is an inspiration for me, more than a city. I mean @millajovovich is simply Berlin!” said Lindbergh. #wwdfashion
“You know, I think audiences expect a certain performance so I have to deliver to them what they’re expecting to a certain degree. But I’m also a different actor and a different person, I have my own spin on the character,” says @noahegalvin of his takeover of the leading role in “Dear Evan Hansen” following the departure of @bensplatt, who originated the role. Read WWD’s interview with the 23-year-old actor on WWD.com #wwdeye (📷: @jilliansollazzo)
For pre-fall 2018, @etro created richly-colored wonderland, using tapestries, textiles and wallpapers from the Eastern world at large. The line featured floral and graphic prints and jacquard motifs, like this two-piece look featured here. #wwdfashion (📷: Giovanna Pavesi)
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)