DOW DROPS, RETAIL, VENDOR STOCKS HIT

NEW YORK — Many retail and vendor stocks were hit hard Tuesday as the stock market plunged, but Wall Street analysts forecast little immediate impact on the action in the stores.
The Dow Jones Industrial Average fell 225.43, or 2.1 percent, to 10598.47 amid concern about a strong Japanese yen, a record U.S. trade deficit and the economic impact of the earthquake in Taiwan.
However, Wall Street retail analysts were not too concerned about the market tumble dimming store performance.
“The drop has nothing to do with retailers’ fundamentals; it is just sector rotation out of the retail industry,” commented Maura Hunter Byrne, analyst at Salomon Smith Barney. “I expect specialty retailers to meet or exceed sales plans for September.”
Added Jeff Edelman, Paine Webber, “Most retailers are in line with plans so far for the month. Retail stocks have had a big run for a year and a half. Interest rates have moved up a little bit, and when interest rates move up, the market moves down.”
Notable losses were seen at Ross Stores, off 2 3/16 to 37 3/16; TJX Cos., 1 7/16 to 27 7/8; Sears, Roebuck, 1 3/8 to 32 1/16; J.C. Penney, 1 1/8 to 35 11/16; Federated Department Stores, 1 1/8 to 45 5/16; Kohl’s Corp., 1 5/16 to 71 11/16, and Dayton Hudson, 7/8 to 55 1/4. Vendor decliners included Jones Apparel Group, down 1 to 27 1/8; Nike, 1 7/16 to 52 1/2, and Gucci Group, 1 1/8 to 87 5/8.
Other firms dropping back were Chico’s FAS, retreating 1 1/8 to 24; Claire’s Stores, 2 1/4 to 17 5/8, Tandy Brands, 1 1/8 to 13 1/2 and Revlon, 13/16 to 24 5/8.
Shares at J. Jill Group fell sharply, dropping 1 11/16 to 4 7/16 in over-the-counter trading after the retailer Monday warned that it would have lower sales and post a third-quarter loss of 11 cents a share before restructuring charges, and said it would discontinue its Nicole Summers catalog. The Tuesday drop followed a fall of 5 1/4 on Monday and came despite the company’s efforts in a conference call to reassure investors that its long-term growth prospects are still healthy.