By Andria Cheng
Retail stocks rose Monday on expectation that retailers' May
sales report this week may show further signs of stabilization in
an industry that has been battered by across-the-board consumer
cutbacks.
The S&P Retail Index (RLX) rose 3.2% to 328.99.
Pent-up demand, warmer weather, less steep levels of promotions
from the holidays and improved consumer confidence are expected to
lessen the decline in demand in May, analysts said. Retailers have
controlled inventory to help reduce discounts.
Discounters and value oriented retailers such as Aeropostale
Inc.(ARO) are still expected to outperform their pricier rivals
such as Abercrombie & Fitch Co. (ANF), analysts said.
While analysts estimated Gap Inc. (GPS), the largest U.S.
clothing chain, to post a decline of about 3% to 5% because of
lower sales at its namesake and Banana Republic chains, its
discount unit Old Navy is expected to show an increase, analysts
said.
Wal-Mart Stores Inc. (WMT) shares were flat at $49.77 ahead of
the company's annual shareholders meeting Friday. Wal-Mart
announced last month it plans to stop reporting monthly same-store
sales.
-By Andria Cheng; 415-439-6400; AskNewswires@dowjones.com