Stocks are off to a downbeat start this morning following Europe’s negative trading after the International Monetary Fund cut its global growth forecasts for the next two years. Brexit was to blame.
The S&P 500 is dropping by 5 points to 2,161, the Dow Jones Industrial average is sliding by 16 points to 18,516 and the Nasdaq is sliding by 32 points to 5,042. The S&P Retail ETF is declining by 21 cents to $44.23.
Guess Inc. shares fell by more than 5 percent to $14.59 after Piper Jaffray analyst Erinn Murphy downgraded the stock to underweight or the equivalent of a sell from neutral. The analyst gave Guess a price target of $12. She also said that the negative catalysts are likely to accelerate. Murphy said she thought the inventory levels were bloated and that the company was expanding its store count at a time when physical stores are contracting for most retailers. She also noted that she was incrementally wary on the company’s turnaround plan to get to 7.5 percent earnings before interest and taxes by 2018.
Revlon Inc. posted preliminary unaudited financial results for its second quarter ending June 30 in connection with its attempt to acquire Elizabeth Arden Inc. Revlon stated that its net sales for the second quarter were $489 million versus last year’s $482 million for growth of 1.3 percent. The operating income was $52 million versus last year’s $61 million for the same period. Revlon stock was higher by 5 cents to $33.14.
Aéropostale Inc. said in court filings that it will be unable to reorganize the company and will instead focus on finding a buyer. The beleaguered teen retailer is preparing to sell its assets and may file a lawsuit against Sycamore Partners saying the private equity firm drove it into bankruptcy. The stock is trading at 3.5 cents.
In Yahoo Inc.’s earnings call after the market close on Monday, the search engine gave an update on the style vertical. Yahoo said Polyvore was recognized with a Webby award for the best mobile site and app for lifestyle for engaging style lovers around the world. Polyvore is a shopping site that Yahoo is integrating within the rest of Yahoo’s style pages. Yahoo stock was down slightly by 22 cents to $37.71.
Nike Inc. promoted Steve Lesnard to vice president, general manager of global running succeeding Patrick Seehafer who will become vice president of Europe merchandising. Lesnard is currently the general manager of North America running. Lesnard is a 19-year veteran of the company. Nike stock is dropping by 33 cents to $57.41.