Investors pushed retail stocks down 1 percent Wednesday ahead of comparable-store sales reports from U.S. retailers today.
This story first appeared in the May 7, 2009 issue of WWD. Subscribe Today.
The S&P Retail Index fell 3.54 points to 338.56 as the Dow Jones Industrial Average advanced 1.2 percent, or 101.63 points, to 8,512.28.
With full results from the government’s so-called “stress tests” due out today, investors breathed a sigh of relief as the $34 billion shortfall in Bank of America Corp.’s finances was smaller than expected.
Retail comps are expected to give the strongest indication yet of whether sales lost in March were shifted into April, as the timing of Easter moved into the latter month. As in previous months, they also will show just how important price has become to recession-addled shoppers.
J.P. Morgan analyst Charles Grom said discounters Wal-Mart Stores Inc. and Target Corp. had favorable traffic trends last month, but apparel and accessories weren’t a big focus for shoppers.
According to Grom, Wal-Mart regained its price leadership in April, with a market basket of 50 items selling for $257.12, below Target’s price of $260.85 for the same goods. Target edged out Wal-Mart on price by 9 cents in March.
Shares of Target rose 0.5 percent Wednesday to $41.47 as Wal-Mart’s stock fell 1.9 percent to $49.51.
Stocks were up around the world, with the FTSE 100 in London ahead 1.4 percent to 4,396.46, as Burberry Group plc rose 0.6 percent to 432.50 pence, or $6.51 at current exchange, and Marks and Spencer Group plc was up 1.4 percent to 351 pence, or $5.28.
The CAC 40 in Paris increased 1.8 percent to 3,283.51. European firms gaining ground included PPR, up 3 percent to 63.18 euros, or $84.53; LVMH Moët Hennessy Louis Vuitton, 1.5 percent to 59.17 euros, or $79.17, and Zara owner Inditex Group, 0.2 percent to 33.12 euros, or $44.31. In Tokyo, the Nikkei 225 rose 1.7 percent to 8,977.37.