The credit markets are showing some signs of health, but the stock market remains schizophrenic and, for retailers, mostly depressed.
The Standard & Poor’s Retail Index initially fell hard on Thursday only to claw its way back, closing down 1.5 percent, or 3.85 points, to 256.40, even as the Dow Jones Industrial Average staged a late rally to close up 172 points, or 2 percent, to 8,691.25.
Retail shares dropped as much as 6.8 percent during the trading session as investors continued to guess at the impact of the financial crisis and economic slowdown on shoppers and retailers.
Several fashion companies have lost more than 75 percent of their share value since hitting their respective 52-week highs, including The Bon-Ton Stores Inc., down 90.6 percent; Charming Shoppes Inc., 84.9 percent; Dillard’s Inc., 83.3 percent; Chico’s FAS Inc., 79.5 percent; Gottschalks Inc., 78.3 percent; New York & Company Inc., 77.9 percent; Liz Claiborne Inc., 76.4 percent; Stein Mart Inc., 76 percent, and Saks Inc., 75.4 percent.
The holiday season is forecast to be the worst in years and investors and store executives appear to be settling in for difficulties.
“A lot of this is just simply consumer sensitivity to pricing,” Bill Rhodes, chief investment strategist at Rhodes Analytics, said. “They are concerned about their incomes. They’re concerned about their work. They probably are not getting the kinds of credit card offers that they were before, in many cases they have to pay [their credit cards] down.”
Rhodes said his models call for an “underweight” position on apparel retailers, but added there was no clear evidence where the markets are headed, especially since the troubles have moved from Wall Street to the broader economy.
Among retail issues on Thursday, Dillard’s declined 22.7 percent to $3.92. The regional department store player was removed from the S&P 500 index on Tuesday, compelling some investment funds that are focused on the index to sell their holdings.
Others on the way down were: Bon-Ton, declining 15 percent to $1.70; Kohl’s Corp., 6.6 percent to $28.26; Sears Holdings Corp., 6.4 percent to $49.98; J.C. Penney Co. Inc., 4 percent to $19.50; Saks 1.9 percent to $5.68, and Stein Mart, 1.5 percent to $1.92. Gottschalks managed to rise 5.4 percent to 97 cents.
Specialty stores losing ground included Charming Shoppes, down 16.7 percent to $1.15; J. Crew Group Inc., 8 percent to $16.71; Urban Outfitters Inc., 7.8 percent to $20.12; Limited Brands Inc., 7.4 percent to $10.89; New York & Co., 7.3 percent to $2.68; Aéropostale Inc., 6.6 percent to $21.85, and Chico’s, 1.1 percent to $2.84.
On the vendor side, G-III Apparel Group Ltd. got a vote of confidence from Eric Beder, Brean Murray Carret & Co. analyst, but the stock still closed down 9 percent to $14.44.
“The company is a key supplier to major department stores with Macy’s remaining its largest buyer; J.C. Penney is also a key resource,” said Beder, who reiterated his “buy” rating on the stock. “You would expect G-III management to bemoan its fate. Instead, it is very upbeat.”
And so is Beder, who said the outerwear and sportswear producer is linked to good brands, including Guess, Calvin Klein, Sean John and Kenneth Cole, has been conservative with inventory, and is gaining traction in the dress category.
Other vendors stumbling in the markets were: Liz Claiborne, down 10.4 percent to $7.30; Jones Apparel Group Inc., 7.2 percent to $8.64; Phillips-Van Heusen Corp., 5 percent to $22.99, and Polo Ralph Lauren Corp., 3.7 percent to $42.39.
There'll be no rest for those headed to Europe for men's, as Paris just closed the gap with Milan. According to a provisional calendar released by the Chambre Syndicale, Paris Men's Week will now open a day earlier on January 16. See new highlights on the official lineup on WWD.com. #wwdnews #wwdfashion (📷: @kukukuba)
BREAKING: Jonathan Saunders is leaving @DVF. The designer has resigned from his position as chief creative officer of Diane von Furstenberg, the company said in a statement on Friday. At the time of his hire, von Furstenberg said Saunders’ arrival symbolized and facilitated her stepping back from the day-to-day duties that occupy the work of a full-time creative director. The British designer joined DVF in May 2016 and was in charge of all product categories. #wwdnews
For @versace_official’s spring ad campaign, the brand emphasized the archival prints from the spring tribute collection dedicated to the late Gianni Versace. Closing out the show were five of Gianni’s favorite models: Cindy, Naomi, Carla, Helena, and Claudia. Bowing on December 18, the new campaign is yet another tribute to supermodel-dom as the images by Steven Meisel are fronted by @iamnaomicampbell, @cturlington, @gisele and more. #wwdfashion
Four-time Oscar-nominated actress Annette Bening has been waiting 20 years to play Gloria Graham in "Film Stars Don't Die in Liverpool," which will be released on December 29. The movie about Graham – a Hollywood star known for her controversial relationship with a younger Englishman named Peter Turner – is based off a memoir Turned wrote. "She felt vulnerable to him, because she loved him, she really did love him. And anyone that we really truly are in love with, we re vulnerable to in a very deep way," said Bening. Read our full interview with the modern icon of an actress on WWD.com. #wwdeye (📷: @ninebagatelles; Styled by @cristinaehrlich)
The crisp white button down: a staple that can be dressed up or down and accessorized throughout the decades. Here, on a Art Basel-goer in 2017 on the left and on the iconic Audrey Hepburn in “Roman Holiday” in 1953 on the right. #tbt #wwdfashion (📷: Andrew Morales)
Known for her work with @victoriassecret, 25-year-old model @georgiafowler is raising her profile in Hollywood. Fowler stars in @vincecamuto’s holiday campaign, which launched in partnership with “Pitch Perfect 3.” “Almost every shoot with Vince Camuto, I’ve had to face a fear…It was definitely a challenge. I’m so grateful for it, though. I’ve always wanted to be a pop star, so that was the perfect chance,” Fowler said. Head to WWD.com to read about Fowler’s experience modeling, including at the #VSFashionShow, and her relationship with Nick Jonas. #wwdeye (📷: @jilliansollazzo)
EXCLUSIVE: Huda Kattan just became the first beauty influencer to land a major beauty deal. Kattan's business, @hudabeauty, has received a minority investment from private equity firm TSG Consumer Partners. The brand, which industry sources say is on track to do $200 million in retail sales for 2017, will receive support on product, retail and geographic expansion through the deal. Get all the details on the deal and read @_a_collins' interview with Kattan on WWD.com. Link in bio. (📷: @jgreenery) #wwdbeauty #wwdnews
Peruvian model @juanaburga_official – who is known for walking the runways of @rodarte, @viviennewestwood and @torybuch – is making the move to the big screen with drama “Los Últimos.” The film premiered in Argentina in November and arrives in the U.S. and Europe in 2018. On making the switch from modeling to acting, Burga told WWD: “It’s a completely different thing – a lot of people think it’s similar or try to connect things, especially like getting used to the camera or being looked at all the time or playing these different characrers, but film is a completely different story.” #wwdeye (📷: @jgreenery)
London’s newly opened @designmuseum will look back on the life and work of Azzedine Alaïa in a show that the designer helped to curate before he died of heart failure last month. The retrospective, which Alaïa had worked on with Mark Wilson, chief curator of the @groningermuseum, will look at the impact of his work worldwide. The show, “Azzedine Alaïa: The Couturier,” will run from May 10 to October 7. Read more about the exhibit on WWD.com #wwdnews #wwdfashion (📷: @zefashioninsider)