Investors looked past the snow that blanketed the East Coast and pushed up retail stocks 1.7 percent Monday, the sector’s second-strongest showing this month.
Although stores in Washington, Philadelphia and New York were hurt by the season’s first big snowstorm, specialty retailers still appear to be playing it relatively close to the vest from a pricing perspective.
“While retailers are still running promotions, inventories seemed very much under control, so most did not seem to be resorting to steep markdowns — a positive for [fourth-quarter] gross margins,” said Credit Suisse analyst Paul Lejuez in a research note.
Eric Beder, an analyst at Brean Murray, Carret & Co., added, “The teen segment remains the most aggressive, as Abercrombie [& Fitch Co.] continues to flail with give-back coupons, while Aéropostale [Inc.] has been consistently 50 percent off the store and American Eagle [Outfitters Inc.] has taken a middle path, which we believe will drive, at best, middling results.”
The S&P Retail Index advanced 6.88 points to 413.96. Leading the charge among U.S. retailers was Zale Corp. with a 30.8 percent jump to $2.72.
Zale’s shares fell 17.8 percent Friday following reports that it was canceling orders in light of weak demand. The company responded by saying it was in the process of “reviewing and canceling certain orders” and that some payments had been delayed as it evaluated its plans.
Also gaining, although not as dramatically, were J. Crew Group Inc., up 2.5 percent to $44.57; American Eagle Outfitters, 2.3 percent to $16.64; Aéropostale, 2.1 percent to $33.07; Dillard’s Inc., 2 percent to $19.21, and Abercrombie & Fitch, 1.5 percent to $32.25.
Debt watchdog Standard & Poor’s gave Dillard’s a nod of approval and put the firm’s credit ratings on review for possible upgrade. The department store is currently rated “B-minus.”
“We believe the company has enough liquidity to operate for at least the next two years, even if sales trends in the moderate department store sector remain weak,” S&P said.
Stock markets generally predict the economic climate six months ahead, and investors are latching onto most any reason for corporate optimism. On Monday, it was acquisitions in the health care and mining sectors.
The Dow Jones Industrial Average rose 0.8 percent, or 85.25 points, to 10,414.14.
French drug maker Sanofi-Aventis agreed Monday to buy health care products firm Chattem Inc. for about $1.9 billion, and Bucyrus International Inc. inked a deal to acquire Terex Corp.’s mining equipment business for $1.3 billion.
The two cash deals lent encouragement to investors searching for signs that companies are looking beyond the current weakness and readying themselves for better times ahead.
@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
@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)
Not only does #TheProfit return to CNBC tonight, but @marcuslemonis has launched @shopmarcus, a new shopping and lifestyle retail experience in Aspen and Chicago, with more locations to come. The retail stores offer in-store stylists and a variety of contemporary womenswear selections.
“It’s life, I’m going to face it,” @mingxi11 sighed. “I fell, but you know, I think the most important thing is that I get back up. I had the love, the help from my sister — the girl next to me Gizele [Oliveira] — she’s so nice. When I went backstage everybody was trying to comfort me like ‘Oh Ming, it’s OK.’ I’m really, really touched. I think it’s them who gave me the courage to go back on stage for the finale,” Xi told WWD of her fall at the @victoriassecret fashion show. (📷: David Fisher) #wwdfashion #vsfashionshow #victoriassecret
@louisvuitton tapped @therealpeterlindbergh for its latest city-centric photo book, which is part of a series called Fashion Eye. The primarily black and white book captures the spirit of Berlin in 57 images shot between 1989 and 2019. “Berlin is an inspiration for me, more than a city. I mean @millajovovich is simply Berlin!” said Lindbergh. #wwdfashion
“You know, I think audiences expect a certain performance so I have to deliver to them what they’re expecting to a certain degree. But I’m also a different actor and a different person, I have my own spin on the character,” says @noahegalvin of his takeover of the leading role in “Dear Evan Hansen” following the departure of @bensplatt, who originated the role. Read WWD’s interview with the 23-year-old actor on WWD.com #wwdeye (📷: @jilliansollazzo)
For pre-fall 2018, @etro created richly-colored wonderland, using tapestries, textiles and wallpapers from the Eastern world at large. The line featured floral and graphic prints and jacquard motifs, like this two-piece look featured here. #wwdfashion (📷: Giovanna Pavesi)
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)