NEW YORK (AP) -- Just a day after TJX, Urban Outfitters and others gave a boost to retail shares, disappointing outlooks from companies including Target and American Eagle Outfitters pushed most of the sector's stocks lower Wednesday. With more earnings reports set for Thursday, the uneven performances are leaving many investors wondering what's next.
Retailers' mixed results and drab forecasts are raising concerns about the critical back-to-school and holiday shopping seasons. The holiday season typically makes up about 40 percent of their annual revenue.
There are some pockets of strength though. Those with ties to the improving housing market — like Home Depot Inc. and La-Z-Boy Inc. — are benefiting from consumers looking to make home-related purchases. But luxury retailers, including Saks Inc. and Nordstrom Inc., are noticing conservative spending by their customers. Some of those shoppers are even looking for designer goods for less, at stores run by companies like TJX Cos. Inc., whose quarterly performance shined.
Meanwhile the world's biggest retailer, Wal-Mart Stores Inc., is seeing weak global economic conditions continue to hurt its low-income shoppers. And one of its rivals, Target Corp., is in a similar situation. Target said Wednesday it now anticipates full-year earnings per share coming in at the low end of its prior guidance, with shoppers cautious on spending.
Americans have been hesitant to spend freely on discretionary purchases like clothes and handbags partly because of stagnant wage growth. And a 2 percentage-point increase in the Social Security payroll tax is giving consumers further reason to pause before opening their wallets.
With companies such as Gap Inc., Sears Holdings Corp., Abercrombie & Fitch Co. and Aeropostale Inc. set to report their latest earnings results Thursday, investors are hoping that a clearer picture of the overall health of the retail sector emerges.
In afternoon trading, here's how some retailers were faring:
—TJX down 35 cents to $53.89.
—Urban Outfitters Inc. fell $1.16, or 2.7 percent, to $42.03.
—American Eagle Outfitters Inc. declined $1.58, or 9.7 percent, to $14.80.
—Home Depot shed 23 cents to $74.06.
—La-Z-Boy added 80 cents, or 3.8 percent, to $22.04.
—Saks dipped 2 cents to $15.90.
—Nordstrom fell 65 cents to $56.45.
—Wal-Mart Stores gained 16 cents to $73.39.
—Target dropped $2.02, or 3 percent, to $65.93.
—Gap declined 67 cents to $42.64.
—Sears rose 52 cents to $42.11.
—Abercrombie & Fitch down $1.76, or 3.6 percent, to $46.74.
—Aeropostale slipped 44 cents, or 3.7 percent, to $11.55.