U.S. retail stocks mirrored the general decline on Wall Street today, where investors are still uneasy about the debt crisis in Europe, even as Spanish banks inched closer to seeing money from a promised euro zone bailout.
The S&P Retail Index fell 0.7 percent, or 4.25 points, to 611.68, as the Dow Jones Industrial Average declined 0.7 percent, or 83.17 points, to 12,653.12.
The sharpest retail decline came from Destination Maternity Corp., which fell 19.6 percent to$17.54 after the company warned third-quarter results were be weaker than expected. For the fiscal third-quarter, the company said its sales fell 5.3 percent to $138.8 million and that earnings per diluted share would range from 51 cents to 53 cents — below the 57 cents to 70 cents previously projected.
“Our strong early sales of spring/summer product in February and March did not continue into the April-June period,” said Ed Krell, chief executive officer. “Our gross margin was also lower than planned, due to increased price promotional activity and additional markdowns taken to spur sales and manage inventory levels.”
Also posting declines were J.C. Penney Co. Inc., which fell 5.8 percent to $20.76 following another round of layoffs; Christopher & Banks Corp., 4.8 percent to $1.39, and Fifth & Pacific Cos. Inc., 4 percent to $9.99.
Bucking the trend was Wal-Mart Stores Inc., which gained 0.5 percent to $72.11— a record high close for the discount giant which has been charging to new heights in recent weeks.
In Europe, finance ministers meeting in Brussels for a two-day summit agreed to inject 30 billion euros, or $36.9 billion, into Spain’s banking system. European leaders have pledged up to 100 billion euros to help the country’s troubled banks. But the money did little to boost the mood of Bank of England governor Mervyn King.
On Tuesday, King talked to BBC Radio 4 about the euro zone debt crisis: “There is a great black cloud of uncertainty hanging over businesses all around the world…The result is, until they know how this situation is going to be resolved, they are holding back from investment and spending.” Frankfurt’s DAX gained 0.8 percent to close at 6,438.33 as London’s FTSE 100 rose 0.7 percent to 5,664.07, Paris’ CAC 40 climbed 0.6 percent to 3,175.4, and Milan’s FTSE MIB increased 0.4 percent to 13,868.27.
Retail and luxury stocks were mostly up, with the day’s biggest gainers including Asos.com, which rocketed 12.6 percent to 18.52 pounds following a 31 percent rise in group revenues in the three months to June 30. Burberry Group, which will report on first-quarter results Wednesday, rose 2.3 percent to 12.84 pounds. And Marks & Spencer Group, which on Tuesday reported a fall in first quarter group sales of 0.7 percent, saw its stock rise 2.1 percent to 3.28 euros.
Safilo Group rose 2.2 percent to 4.46 euros, while Ferragamo climbed 2.1 percent to 16.04 euros. The euro traded at $1.23 against the dollar while the pound traded at $1.55.