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Tale of the Tape  

Holiday Sales Fail to Bail Out Retailers

January 08, 2009 | Comments: 0
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U.S. stocks fell on Thursday after most retailers posted weak retail sales and reduced their earnings outlook, even after denting margins with heavy discounts to lure consumers. Bellwether Wal-Mart (WMT - Snapshot Report) missed Wall Street expectations on December same-store sales and guided to a dismal fourth quarter.

Wal-Mart blamed snowstorms during the crucial holiday season for forecasting quarterly earnings between 91 cents to 94 cents a share, down from a prior view of $1.03 to $1.07. Although Wal-Mart was one of the few retailers that posted comparable-store sales growth for the month of December, the 1.7% increase still fell short of analysts’ estimates. The retailer fell more than 8% to $50.31 after the announcement.

Rivals Target (TGT - Snapshot Report) saw December same-store sales falling 4.1%, while comps were down 4% at Macy’s (M - Snapshot Report). Both the companies warned of lower profits in the fourth quarter. Gap (GPS - Analyst Report), Abercrombie & Fitch (ANF - Analyst Report) and jeweler Zale (ZLC - Snapshot Report) also painted a gloomy picture for investors.

The Dow Jones Industrial Average recently was down 90.40 points, or 1.03%, at 8679.30. The S&P 500 fell 6.61 to 900.04, while the Nasdaq Composite Index dropped 4.81 points to 1593.92 at late noon.


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Market Summary Nov 08, 2009 13:44 pm ET
DJIA 10023.42  17.46 0.17%
NASD 2112.44  7.12 0.34%
S&P 500 1069.3  2.67 0.25%
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