After Monday’s roller-coaster ride in the U.S. markets, stocks are opening this morning to the upside. The recovery is due to the moves taken by the People’s Bank of China to stabilize its markets. Futures initially pointed to the Dow Jones Industrial Index rising 500 points, but the Dow opened up 363 to 16,235.14, the S&P 500 was up 41 to 1,934 and the Nasdaq increased 136 to 4,663.

China’s stock market rout on Monday set off a chain reaction around the world, causing billions of dollars of financial destruction. On Tuesday, the PBOC threw every kitchen sink it could think of at its markets. They cut interest rates, cut the required reserve ratio on deposits, cut deposit and lending rates and for good measure cut the banks’ deposit reserve ratio by 50 basis points. Still, the Shanghai Composite ended down another 7.6 percent.

Europe refused to play along and its indices mostly traded higher. It was helped with the German GDP rising 0.4 percent in the second quarter and 1.6 percent year over year.

The drop in stock valuations led many analysts to upgrade several retail stocks. Deutsche Bank based on valuation upgraded Macy’s to Hold from a Sell and Standpoint Research initiated coverage on Macy’s with a Buy rating. American Eagle Outfitters was also upgraded to outperform on Tuesday by FBR & Co. and the target price was raised to $19 from $17.

DSW stock is trading lower by 5 percent to $29.22 after missing earnings estimates but delivering inline earnings. The footwear retailer reported that sales increased 6.8 percent to $627 million, but that was shy of the $635 million that was estimated. Earnings per share were up 13.5 percent to 42 cents. DSW has seen a significant shift in favor of regular priced merchandise selling, which helped push gross profits higher. DSW forecast that earnings for the full year would be $1.80 to $1.90 a share, meeting expectations.

The Children’s Place delivered earnings that were inline, but was light on revenue. The kids retailer reported a second quarter loss of 33 cents a share, meeting analysts’ expectations, but revenue of $366.5 million was 4.7 percent less than last year and below the estimates of $381.1 million. The company blamed the promotional environment and continuing West Coast port problems. On a positive note, The Children’s Place chief executive officer Jane Elfers said traffic picked up in August and the company has seen a positive response to its back-to-school assortment. The stock is up 1 percent to $57.79.

Looking ahead, there are a slew of retail and fashion earnings lined up for Wednesday. On tap are Abercrombie & Fitch, Brunello Cucinelli, Chico’s, Express, Guess, PVH, Tilly’s and Williams Sonoma.

In economic news, it’s costing more for housing. The FHFA Housing Price Index rose 0.2 percent in June and revised May up to an increase of 0.5 percent. The Case-Shiller 20 city Home Price Index for June rose 5 percent in June following an increase of 4.9 percent in May. Luxury homebuilder Toll Brothers missed its earnings estimates as its prices fell and deliveries declined. Signed contracts increased over last year.

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