For most retailers, the arduous task of reporting second-quarter results has come and gone and, as expected, the picture they painted wasn’t pretty.
But the few last week who could lay claim to some sort of good news, or hint there was good news coming, were rewarded by investors. Their gains stood out in a week when the S&P Retail Index inched up 1.1 percent to 370.35 and the Dow Jones Industrial Average advanced 0.4 percent to 9,544.20.
Shares of Guess Inc. shot up 16 percent to $35.46 for the week as second-quarter earnings rose 10.6 percent.
“We definitely feel that conditions have stabilized in a number of ways, but that doesn’t mean the crisis is over and there is no doubt there are challenges ahead,” said Paul Marciano, chief executive officer.
At J. Crew Group Inc., a slight rise in profits helped push its stock up 10.3 percent to $34.73. Millard “Mickey” Drexler, chairman and ceo, also saw signs of improvement and said the downturn has had its benefits. “There’s nothing like a good old-fashioned recession to make you run a better business,” he said.
Chico’s FAS Inc.’s net income more than doubled on sales gains and the retailer’s stock rose 8.4 percent to $13.11. And Coldwater Creek Inc. posted a loss, but said it was ready to ramp up spending on marketing and inventory to drive sales. Investors pushed the stock up 10.3 percent last week to $7.69.
Of 172 stocks tracked by WWD, 117 were up for the week, 8 were flat and 47 were down.
Friday also brought fresh signs that the economy could be headed toward better days.
The Economic Cycle Research Institute said the four-week moving average growth rate of its Weekly Leading Index hit a 38-year high of 19.6 percent. The index had a modest dip for the week ended Aug. 21.
Lakshman Achuthan, the forecasting firm’s managing director, said the index’s continuing surge meant “a double dip back into recession in the fourth quarter is simply out of the question.”
But the next few years could still be trying ones for retailers.
Charles McMillion, president and chief economist at MBG Information Services, said the recession might be nearing an end, but that the recovery could be “weak and fragile” without additional government intervention.
The Commerce Department reported that July disposable personal income held steady from June and McMillion noted the measure fell 0.2 percent on an inflation-adjusted-per-capita basis. Personal consumption expenditures rose 0.2 percent in July.
But McMillion said the record $13.9 trillion decline in household wealth from the second quarter of 2007 through the first quarter of this year would continue to weigh on spending.
“I do not expect total…household net worth to return to constant dollar 2007 levels until 2015 or later suggesting that the sluggish growth in spending may persist for many years,” McMillion said.
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
New York-based DJ @harleyvnewton threw a party to celebrate the holiday collection of her dress and pajama line @hvn at the Ladurée Beverly Hills. It Girls @katebosworth, @rashidajones and more joined in on the fun, which included cocktails, croque monsieur sandwiches and a photo booth. #wwdfashion (📷: Owen Kolasinski/BFA.com)
For the holidays, @Burberry partnered with 20-year-old artist @blondeymccoy on a series of three outdoor murals in downtown Manhattan. The murals are McCoy’s interpretation of a Christmas eve party, the idea of charity and the spirit of family. His third mural, pictured here, is the most personal. The image depicts McCoy’s grandparents and father in London’s Trafalgar Square in the Seventies. “My work often features lots of sentimental objects.” #wwdeye
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)
In a partnership between the @metopera and the @englishnationalopera, “Marnie” was born. The opera, with costumes sponsored by @mrporterlive, is an adaptation of the 1961 thriller by Winston Graham. Arianne Phillips, who created the costumes, is no rookie: She’s styled Madonna for her tours and created costumes for a myriad of films in the past. Read WWD’s interview with Phillips, where she talks about her inspiration for the opera’s costumes on WWD.com #wwdfashion
@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