Consumers and lenders felt good enough about the economy to expand credit card debt for the first time in 27 months in December, helping to push retail stocks to a 0.5 percent gain Monday.


The Federal Reserve said outstanding revolving credit inched up a seasonally adjusted 0.3 percent to $800.54 billion in December, the first monthly gain since August 2008, just before Lehman Bros. collapsed and the financial crisis took hold. Total consumer credit grew for the third straight month.


The S&P Retail Index rose 2.31 points to 509.53 as the Dow Jones Industrial Average gained 0.6 percent, or 69.48 points, to 12,161.63. Investors were also encouraged by a flurry of acquisition activity, including AOL Inc.’s $315 million deal to buy The Huffington Post.


Fashion’s gainers included J.C. Penney Co. Inc., up 5.7 percent to $33.39; The Talbots Inc., 3.2 percent to $5.42; Saks Inc., 2.9 percent to $11.45, and Phillips-Van Heusen Corp., 2 percent to $62.77.


PVH also got a nod of approval from Moody’s Investors Service Monday, which revised its outlook on the firm’s debt to “positive” from “stable” based on its success at paying down the debt on its May 2010 acquisition of Tommy Hilfiger for $3 billion.


Moody’s noted that PVH has repaid $250 million of the debt from the acquisition and is expected to make an additional $150 million prepayment this month. “PVH has shown improved operating performance at its heritage businesses and the integration of Tommy Hilfiger remains on schedule,” the rating agency said in a research note authored by vice president and senior analyst Scott Tuhy.


The company’s credit ratings, including its corporate family standing of “Ba3,” were maintained, but Moody’s said they could be upgraded if positive earnings trends and the progress of the Hilfiger integration into its operations were to continue and its debt-to-EBITDA ratio were to fall below a multiple of 4. “Ba” ratings are just below the lowest investment-grade class of “Baa.”

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