Sector Snap: Retail stocks rise
Retail stocks rise as increase in consumer sentiment lifts hopes that shoppers will buy more
NEW YORK (AP) -- Shares of retailers rose modestly Friday on news that a measure of U.S. consumer confidence jumped to its highest level in almost six years in May, helped by rising home prices and record stock market gains.
The greater confidence could help revive spending in coming months, which is good news for retailers. Some have had difficulty enticing shoppers amid choppy consumer spending in the years since the Great Recession.
The University of Michigan said Friday that its consumer sentiment index rose to 84.5 in May, up from 76.4 in April and the highest since July 2007. A better job market contributed to the rise in consumer optimism. And for the first time in five years, more consumers said their finances had improved rather than worsened.
But signals are mixed. The Commerce Department reported Friday that consumers cut back on spending in April for the first time in nearly a year, partially as a result of lower gas prices. Adjusting for inflation, spending ticked up 0.1 percent, the smallest gain in six months. Incomes were unchanged.
Here's how shares of some retailers were trading Friday:
— Guess Inc., up $3.14, or 11 percent, to $32.50. The company reported a 63 percent drop in first-quarter profit, but that beat low analyst expectations.
— Gap Inc., up $1.09, or 3 percent, to $41.08.
— Abercrombie & Fitch Co., up 99 cents, or 2 percent, to $51.28.
— American Eagle Outfitters Inc., up 39 cents, or 2 percent, to $20.15.
— Aeropostale Inc., up 27 cents, or 2 percent, to $14.89.
— Chico's FAS Inc., up 60 cents, or 3 percent, to $18.47.
— TJX Cos., up 49 cents to $50.54.
— Ross Stores Inc., up $1.13, or 2 percent, to $65.80.
