Wall Street responded to President-elect Barack Obama’s historic victory by showing anxiety over the nation’s economic woes, which pushed down retail stocks 5.7 percent.
The Standard & Poor’s Retail Index fell 17.01 points to 283.24, giving back the 10.53 gain the index registered before the polls closed on Tuesday.
The Dow Jones Industrial Average dropped 5.1 percent, or 486.01 points, to 9,139.27, surrendering all of Tuesday’s 305.45-point rally.
From the perspective of investors in fashion stocks, there is little Obama can do to help soothe shoppers for the holiday season or ease the pain of what is expected to be a weak October same-store sales report today.
“October was fairly dreadful for most retailers,” said Jennifer Black, analyst and president of Jennifer Black & Associates. “The U.S. consumer will likely not be a vast reservoir of economic stimulus for the global economy. Rather, the U.S. consumer is part of the contingency that will be paying down the $700 billion bailout well into the future. The global engine will likely slowly move toward such developing countries as China, Brazil and India.”
In addition, the ICSC-Goldman Sachs Holiday Survey found that 37 percent of consumers were likely to scale back on their gifts and other holiday-related expenditures this year. Spending for the holidays is expected to average $1,154 per household, with $533 of that going directly to gifts, exclusive of gift cards.
Among the broadline players losing ground were Dillard’s Inc., down 9.6 percent to $4.99; Saks Inc., 9 percent to $5.45; Target Corp., 8.7 percent to $37.75; Macy’s Inc., 7.4 percent to $10.85; Nordstrom Inc., 5.4 percent to $16.01; J.C. Penney Co. Inc., 4.1 percent to $22.23, and Wal-Mart Stores Inc., 3.6 percent to $54.13.
Specialty stores that saw their shares heading south included Chico’s FAS Inc., off 12.1 percent to $2.77; Urban Outfitters Inc., 9.8 percent to $20.13; Talbots Inc., 8.7 percent to $7.54; J. Crew Group Inc., 7.1 percent to $17.77; Aéropostale Inc., 6.7 percent to $22.18; Limited Brands Inc., 5.7 percent to $11.51, and American Eagle Outfitters, 3.8 percent to $10.17.
Vendors with declining market capitalization included Fossil Inc., down 13.3 percent to $16.48; Jones Apparel Group Inc., 7.8 percent to $9.71; Warnaco Group Inc., 6.2 percent to $25.63; Nike Inc., 6.1 percent to $52.78, and Liz Claiborne Inc., 5.1 percent to $7.05.
One retailer that seemed to buck the trend was Hot Topic Inc., which on Wednesday said October comparable-store sales jumped 8.3 percent at its namesake stores, exceeding analyst projections. Comps at its Torrid locations rose by 7.8 percent.
EXCLUSIVE: @tomford is opening its first-ever beauty store. The boutique, which opens November 20 in London’s Covent Gardens, was designed with the over-the-top glam Ford is known for. Read the full story on WWD.com, link in bio. #wwdbeauty #wwdnews (📷: Simon Wagner) #TomFordBeauty
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For spring 2018, designers applied bold colors and cartoonish motifs on everything from sneakers and belts to key chains. See all the top men’s accessories trends on WWD.com. #wwdtrends (📷: George Chinsee; Prop Styling by @rnasti; Market Editor: @luiscampuzano)
The @dior-sponsored @guggenheim international gala pre-party has a history of drawing cool-girl musical acts to serenade the crowd –– and last night was no exception. @haimtheband performed songs both new and old, and lured a star-studded audience with the likes of Rebecca Hall, Kate Mara, Mamoudou Athie and more. #wwdeye (📷: @lexieblacklock)
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@barneysnyc took a different approach to their holiday windows this year. Instead of Christmas decor, Barneys tapped @thehaasbrothers to tell a story of positivity, gratitude and inclusivity via heartwarming silliness and humor. “It’s about kids and it’s about coming together and being family and loving each other,” said Simon Haas. #wwdfashion (📷: @joshuascottphoto)
Beauty influencer @kandeejohnson makes her foray into hair care with a collaboration with @ogx_beauty — making it the first time that OGX has teamed up for a product creation. The collab includes shampoos and conditioners in three scents. At 39 and a mom, Johnson is a different profile than the emerging social media stars, but is considered one of the pioneers of the digital beauty influencer world. Read WWD’s interview with her on wwd.com, including the strangest beauty product she’s ever tried #wwdbeauty