Stocks are trading lower as investors worried over the latest reading of the April consumer price index.
Consumer prices rose the most in the past three years with the cost of gas, food and shelter jumping rapidly. Clothing and car prices were about the only categories to decline. Apparel prices declined 0.3 percent from March and have dropped 0.6 percent year-over-year. The cost of rent has risen for the fifth consecutive month and is up 3.7 percent for the year.
It isn’t exactly inflation but is made the market very jittery. The S&P 500 fell 5 points to 2,060, the Dow Jones Industrial average dropped 62 points to 17,648 and the Nasdaq slid 10 points to 4,765. The S&P Retail ETF lost 17 cents to sell at $41.21.
Francesca’s Holdings Corp. stock is plunging 29 percent to $10.52 after the specialty chain announced the chief executive officer Michael W. Barnes had resigned and former lead director Richard W. Kunes would step in as interim ceo. The retailer also said its preliminary comparable sales for the fiscal first quarter had increased 2 percent and that preliminary earnings per share would be 17 cents. Consensus was for sales to be $109 million and EPS to be 20 cents, so essentially Francesca’s will miss the estimates.
The TJX Cos. Inc. stock rose almost 2 percent to $76.64 after the off-price retailer beat analyst expectations. Net income rose 7.1 percent to $508.3 million, or 76 cents a diluted share, from $474.6 million, or 69 cents, a year ago. Net sales rose 9.9 percent to $7.54 billion from $6.87 billion. Wall Street was expecting 71 cents on revenues of $7.29 billion. The success of TJ Maxx led the company to raise it guidance for the full year.
Michael Kors Holdings Ltd. is up more than 1 percent to $42.03. BB&T Capital Markets analyst believe that the stock has fallen enough to make it a good entry price for buyers. The analysts believe that Kors will beat expectations when it reports it fourth quarter results on June 1.