NEW YORK - U.S. stocks ended Tuesday's trading sessions lower over fears of a recession looming on the horizon, but retail shares essentially held their own.
The Dow Jones industrial average lost 106 points and closed at 10,778, while the Nasdaq lost 23 points to close at 2,227.
Investors on Tuesday were concerned about an economic slowdown as the bond market indicated the yield curve inverted for the first time in five years. The inversion meant that short-term interest rates are higher than long-term ones. In the past, a similar move in the yield curve has preceded an economic slowdown.
Yet fears of a recession didn't seem to impact retail shares, even though most retailers are aggressively promoting sales to clear out inventory so spring merchandise can be moved onto the selling floors.
"The post-Christmas rush remains important to holiday sales results, as last year it accounted for approximately 10 percent of sales and we expect it to be bigger this year with the continued growth of gift cards," observed Merrill Lynch retail analyst Mark Friedman in a research note Tuesday. "Schools are now closed, people are on vacation and returns are being done. This means store credits or cash to burn. This is well timed for clearance sales."
The specialty retail analyst wrote in his research note that gift cards remain significant to the holiday season, as they have become popular gifting items.
"With post-holiday markdowns being taken across numerous retailers, we anticipate a large portion of gift card holders will utilize their cards this week to take advantage of the sales," he concluded.
Shares of some specialty stores gained ground in Tuesday's trading session. Abercrombie & Fitch, which offered few markdowns during the holiday selling season, rose 64 cents to close at $65.62 in Big Board trading. Shares of American Eagle Outfitters, its competitor in the mall, lost just 2 cents to close at $22 in Nasdaq trading.
Shares of teen retailers were mixed, as evidenced by Pacific Sunwear, which rose 3 cents to close at $25.28, while Urban Outfitters closed at $25.87, down 17 cents. Both PacSun and Urban trade over the counter.
However, teen retailer Zumiez Inc., which went public earlier this year, gained $1.01 to close at $42.34 in over-the-counter trading.Citi Trends Inc., a retailer of urban fashion and accessories for men, women and children that also went public earlier this year, saw its shares climb 60 cents to close at $39.25 in over-the-counter trading.
Among the other specialty chains trading on the New York Stock Exchange, many gained ground on a day when stocks mostly tumbled.
Some of the winners were Aéropostale Inc., which closed at $25.82, up 32 cents; Buckle Inc., $32.34, up 20 cents; Gap Inc., $17.66, up 2 cents, and New York & Co. Inc., $20.81, up 6 cents.
There were a few trading on the Big Board that lost ground, such as Chico's FAS Inc., $43.92, down 40 cents; Tiffany & Co. Inc., $38.30, down 86 cents, and Talbots, $27.30, down 20 cents.
In the department store group, shares of Federated Department Stores fell $1.28 to close at $64.97, while Saks Inc. rose 29 cents to close at $16.70 after an analyst at A.G. Edwards upgraded the stock to "hold" from "sell," noting there was a 50 percent chance of a buyout over the next two years. Both stocks trade on the NYSE.
Sears Holdings, which owns the Sears and Kmart nameplates and trades over the counter, rose 11 cents to close at $119.95.
Among the discounters, Kohl's Corp. climbed 54 cents to close at $49.24, while Target rose 7 cents to close at $55.58. Wal-Mart Stores, which has been aggressive in pricing during the holiday selling season, fell 61 cents to close at $47.73. The stocks of all three discounters trade on the Big Board.
My character, Dinah Madani, is just the coolest, [most] badass woman imaginable," says @amberroserevah. The actress stars in @marvel's newest series on @netflix, @thepunisher. To prepare for her role, Revah sat down with Homeland agents to get a real sense of with Dinah's day-to-day life is really like. Read our full interview on WWD.com. #wwdeye (📷: @jilliansollazzo)
A scene from the 91st annual @macys Thanksgiving Day Parade. The parade, which boasts 50 million TV viewers and 3.5 million on-site spectators, is considered one of the largest and most watched parades in the world. (📷: Jason Szenes/EPA-REX)
The circus came to @bloomingdales 59th Street on Tuesday night and lit up Lexington Avenue with acrobatic dancers, death-defying knife throwing, sword swallowing and aerial acts with no net. The 45 minutes of theatrics built up to unveiling the holiday windows depicting @swarovski crystal-encrusted circus pieces and scenes from “The Greatest Showman” – songs from the soundtrack included. See the rest of the photos on WWD.com #wwdfashion (📷: Joshua Scott)
The psychedelic fashion that pervaded the ’60s is back with an exhibit at the @museumofcityny. “Mode New York: Fashion Takes a Trip” chronicles the changing styles from 1960 through 1973 and features designers such as @ysl, @oscardelarenta and more. The exhibition, which is on display through April 1, is organized into four periods: First Lady Fasion, Youthquake, New Bohemia and New Nonchalance. Pictured here is model Pat Bardonella during the Garvey Day Parade in 1968. (📷: @kwamebphoto) #wwdeye #wwdfashion
“People should be a lot more honest in expressing both the dark and light of themselves. We need to give each other the space to do that because it’s the only way we can grow and evolve,” says @noelwells of her new film “Mr. Roosevelt,” which is largely based on her own struggles. Unexpectedly leaving @nbcsnl in 2014 after just one season, Wells felt set back in her self-esteem and career trajectory. She quickly refocused her energy to more personal projects, which led to the completion of “Mr. Roosevelt.” Read the rest of WWD’s interview with the “Master of None” actress on WWD.com #wwdeye (📷: @jilliansollazzo)
@barbrastreisand is giving fans a chance to see her perform up close in a new concert series, which makes its debut on @Netflix today. From behind-the-scenes takes to her concert performance in Miami last December, the two-hour streaming special captures Streisand in her element. Pictured here is the singer/actress photographed for WWD in 1963. (📷: Palmieri Tony) #wwdeye #wwdarchive
@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)