Bad Dec. Retail Drives Down Markets at Opening
Today's news -- at least until President-elect Barack Obama makes his big economic speech later this morning -- is all about retail.
The nation's major retailers reported December -- i.e. holiday -- sales figures today and most are disappointing. That's Wall Street talk for "bad." And the news is making an impact on the markets.
In the first 15 minutes of trading, the Dow is down about 65 points, or .7 percent.
The S&P 500 and the Nasdaq are both down but each less than .5 percent.
The big dog of retail and a bellwether of the recession is Wal-Mart, which was one of the sole winner stocks of 2008.
And even though Wal-Mart's same-store December sales rose 1.7 percent, analysts had expected them to grow 2.8, so there's your disappointment.
The news across the rest of retail was worse. Even though sales volume did not crash, margins were terrible because of the deep discounts retailers had to offer to get anyone in their stores.
Sak's sales were down 19.8 percent in December, twice as bad as Wall Street had expected. Sak's, Abercrombie & Fitch, American Eagle and J. Crew all lowered guidance.
Two of the few bright spots were Aeropostale, which raised guidance, and Target, where December sales were down only 4.1 percent, less than analysts' expectations.
January 8, 2009; 9:50 AM ET
Categories: The Ticker | Tags: Dow Jones, Retail, Wal-Mart
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