Retail stocks fell 0.4 percent on Wall Street today, but the J.C. Penney Co. Inc. rollercoaster continued and investors pushed the stock up 8.5 percent to $8.14 after an analyst offered a slightly better take on the ailing department store’s sales outlook.
The S&P Retailing Industry Group slipped 3.75 points to 890.88 while the Dow Jones Industrial Average gained 0.5 percent, or 69.80 points, to 15,615.55.
ITG Investment Research analyst John Tomlinson projected that Penney’s third-quarter comparable-store sales would fall 4 percent — an improvement from the 6 percent drop he previously projected. The analyst also boosted his forecast for Penney’s total sales for the quarter to $2.81 billion from $2.75 billion.
“The main driver to the change in our forecast is that our most-recent data and analysis points towards much improved [year-over-year] sales growth during week 11 [of the quarter], which was a strong rebound from the weak sales trends we had observed during week 10,” Tomlinson.
Penney’s chief executive officer Myron “Mike” Ullman 3rd said the company would come out in the third quarter with a “positive comp” at the WWD CEO Summit this week.
Among the fashion companies losing ground in the market were Bebe Stores Inc., down 6.5 percent to $5.65; American Apparel Inc., 6.7 percent to $1.25; The Bon-Ton Stores Inc., 3.1 percent to $11.10; American Eagle Outfitters., 2.3 percent to $15.13, and Michael Kors Holdings Ltd., 2 percent to $75.43.
Investors continue to try to sort out when the Federal Reserve will deem the economy strong enough to grow on its own and begin to pull back on its easy money policies. One positive economic indicator came from the Institute for Supply Management’s manufacturing index, which beat economists’ projections and rose to 56.4 last month, from September’s 56.2. Readings above 50 indicate expansion.
Europe’s markets were predominantly down at the close.
The FTSE MIB dropped 1 percent to 19,164.26, the CAC 40 in Paris lost 0.6 percent to 4,273.19, Frankfurt’s DAX slipped 0.3 percent to 9,007.83 and London’s FTSE 100 was slightly ahead, up by 0.1 percent to 6,734.74.
The euro was trading at $1.38 against the dollar while the pound fetched $1.60.
Retail and luxury stocks put on a mixed show, which the day’s strongest gainers including Mulberry, up 4.7 percent to 10.75 pounds; Asos.com, 2.6 percent to 56.96 pounds, and Yoox.com, 0.8 percent to 26.70 euros.
Among the shares losing ground were Safilo, down 2.4 percent to 14.74 euros; Luxottica, 1.7 percent to 39.33 euros, and Inditex, 1.2 percent to 119.50 euros.