Retail stocks pushed ahead Thursday, rising 1.4 percent and establishing a new high for the year despite continued concerns about consumer spending.
The S&P Retail Index shot up to 359.42 early Thursday, but couldn’t sustain all the gains through the afternoon and closed ahead 4.72 points at 354.10. Retail shares have been testing levels not seen since early October, when the financial crisis was at full boil.
Stocks were supported by a smaller-than-expected increase in jobless claims, helping the Dow Jones Industrial Average rise 0.9 percent, or 83.74 points, to 9,154.46. The Labor Department reported 584,000 new jobless claims last week, an increase of 25,000. The four-week moving average for initial claims fell by 8,250.
“A more frugal, value-conscious consumer could keep pressure on retailers’ sales, which will mean that the long-awaited acceleration in top-line growth is still not yet at hand,” said Bill Dreher Jr., a broadlines equity analyst at Deutsche Bank.
Dreher predicted some back-to-school sales will shift into August at the expense of July given a later Labor Day this year and changes in the timing of tax-free shopping days.
Second-quarter results from Saks Inc., Macy’s Inc., J.C. Penney Co. Inc. and Kohl’s Corp should be helped by stronger gross margins and cost reductions, the analyst said.
Posting stock gains on Thursday were Zale Corp., up 14.6 percent to $5.58; Coldwater Creek Inc., 8.1 percent to $7.17; New York & Company Inc., 6.9 percent to $3.57; Pacific Sunwear of California Inc., 5.8 percent to $3.31; AnnTaylor Stores Corp., 5.6 percent to $11.82; Destination Maternity Corp., 4.6 percent to $22.16; Tiffany & Co., 2.6 percent to $29.74; Macy’s Inc., 2.5 percent to $13.61; J.C. Penney Co. Inc., 1.4 percent to $29.46; The TJX Cos. Inc., 0.7 percent to $36.62, and Saks Inc., 0.6 percent to $5.23.
Kohl’s Corp. headed the other way, dipping 0.2 percent to $49.40.
After the market closed, off-price giant TJX got a vote of confidence from Moody’s Investors Service, which switched its ratings outlook on $775 million of the firm’s debt to “stable” from “negative.” The firm’s senior unsecured rating of “A3” and its commercial paper rating of “Prime-2” were affirmed.
“The change in outlook to stable from negative acknowledges TJX’s stable operating performance and credit metrics within the challenging economic environment,” said the debt watchdog. “In addition, the change in outlook reflects Moody’s opinion that TJX will continue to generate solid operating results despite ongoing recessionary pressures facing the retail industry.”
Breaking News: @louisvuitton's men's artistic director @mrkimjones is leaving the French fashion house after nearly 7 years. Jones joined Louis Vuitton in 2011, following a three year tenure as creative director of British luxury goods brand Alfred Dunhill. Jones is to exit Louis Vuitton after showing his fall 2018 collection for the brand in Paris on Thursday. Read the full exclusive story on WWD.com. Link in bio. #wwdnews #wwdfashion
For men’s fall 2018, @giuseppezanotti drew on elements from streetwear, sport, biker, combat and rock ‘n’ roll. Pictured here are a pair of shoes from the collection, featuring zippers, rhinestones, and silver hardware. Head to WWD.com to see a roundup of the accessories from Milan’s men’s fall 2018 shows. #wwdfashion (📷: Andrea Delb)
To celebrate the 25th anniversary of @ralphlauren’s snowboarding collection, the brand is mining its archives. The iconic brand is reintroducing vintage styles and dropping new designs for a color capsule that will be available in Ralph Lauren stores and @openingceremony on January 25. The capsule will consist of 10 pieces, including the Snow Beach Pullover, pictured here, which is a collector’s item that rapper Raekwon wore in Wu-Tang Clan’s “Can It Be All So Simple” video. #wwdfashion (📷: Tom Gould)
For @rochasofficial’s pre-fall 2018 collection, creative director Alessandro Dell’Acqua channeled the sophisticated and intriguing Catherine Denevue in the film “Belle de Jour.” Polished collarless coats, midi skirts, suits and ’60s graphic motifs were all featured in the collection, adding a sense of discreet luxury. See the rest of the photos on WWD.com #wwdfashion
“We tried to produce clothing of that couture quality, but the most daunting part was that we only had a matter of days [to do it],” said costume designer Lou Eyrich, who recreated Gianni Versace’s iconic looks for @americancrimestoryfx. Eyrich searched online retailers and vintage shops for original pieces from the design house and for @penelopecruzoficial, who plays Donatella Versace. Head to WWD.com to read how she created the Versace world. #wwdfashion
Only three months after her stellar debut catwalk season, @kaiagerber has inked her first big design collaboration –– with @karllagerfeld. The collection blends Lagerfeld’s Parisian chic aesthetic and the model’s signature West Coast casual style via RTW, accessories, footwear and more. The #KarlLagerfeldxKaia collection will launch in September with a series of events. Get all the details on WWD.com. #wwdnews #wwdfashion
Harrods plans to remove the famous statue of Princess Diana and Dodi Al Fayed from the bottom of the Egyptian escalators and hand it back to Mohamed Al-Fayed. “We are very proud to have played our role in celebrating the lives of Diana, Princess of Wales and Dodi Al Fayed at Harrods and to have welcomed people from around the world to visit the memorial for the past 20 years,” said Michael Ward, Harrods managing director. “With the announcement of the new official memorial statue to Diana, Princess of Wales at Kensington Palace, we feel that the time is right to return this memorial to Mr. Al Fayed and for the public to be invited to pay their respects at the palace.” More on the news, with reporting by @loreleimarfil, at WWD.com. #wwdnews