Stocks are continuing to track the price of oil. This morning crude oil clicked over $50 a barrel and the stock market followed suit.
The Dow Jones Industrial average rose by 71 points to 17,991, the S&P 500 added 4 points to trade at 2,113 and the Nasdaq is higher by 2 points to 4,971. The S&P Retail ETF is sliding by 12 cents to $42.56.
The biggest retail headline this morning is the stock market reaction to the restructuring plan announced by Ralph Lauren Corp. The company’s stock was down more than 7 percent to $88.88 after the classic apparel brand announced that it planned to cut up to 1,000 employees, close stores, take a $400 million charge and forecast lower revenues. New chief executive officer Stefan Larsson disclosed the restructuring strategy, called the “Way Ahead” plan, ahead of the company’s investor day. The charges are expected to be realized by the end of fiscal 2017. First quarter revenue is forecast to be down mid-single digit and the full-year revenue to decline at a low single digit rate. Larsson detailed how he studied the problems with the company and wasn’t wasting any time to correct course.
Larsson said the company will focus on 3 core brands Ralph Lauren, Polo and Lauren and also put more effort into the iconic styles that result in fewer mark downs and have higher margins. So far, even though the stock is selling off, trader comments seem to be pleased with the hard actions that Larsson is taking.
Stein Mart Inc. revised its preliminary first quarter results for the quarter ending April 30, that was released on May 19. The revision will increase expenses by $675,000. Expenses for the first quarter will include a $1.4 million for actual and anticipated legal expenses. The stock is mostly flat this morning, rising 2 cents to $7.14.
Vince Holding Corp.reported a first quarter net loss following the company’s planned reduction in promotional activity and inventory levels. Vince stock is up over 4 percent to sell at $5.93 because it beat estimates by 6 cents and also beat on revenues. For the three months ended April 30, the net loss was $1.9 million, or 5 cents a diluted share, against net income of $2.5 million, or 6 cents, a year ago. Net sales rose 13.1 percent to $67.6 million from $59.8 million and topping the Capital IQ estimate for $55 million.
Nike Inc. is suing a runner for violating his endorsement deal. Boris Berian has been sponsored by Nike, but decided to switch to New Balance. Nike said it matched the deal that New Balance offered, but Berian declined the new deal. Berian’s response has been to pull out of races instead of wearing a Nike logo. Nike stock is down28 cents to $54.02.