NEW YORK — Despite rising gas prices and sluggish spring sales, consumer confidence remained steady, edging industry stocks out of their four-week slump to end on a slight upswing.
The WWD Composite Stock Index rose 0.65 percent for the week to close at 1,124.47 from 1,117.2 the prior week, while the S&P 500 rose 0.7 percent to close at 1,181.20.
According to an April 8 poll by the Associated Press and market research consulting firm Ipsos, the consumer confidence index rose narrowly to 84.5 in April, compared with March’s reading of 84.2.
In an April 7 report, Lehman Brothers analyst Robert Drbul said that when Easter coincides with the onset of spring weather, it typically drives sales in apparel as well as lawn and garden supplies. “While spring and Easter clearly did not coincide this year, we believe that retailers have the opportunity to recapture some of these sales in April, although a portion of these sales were entirely lost,” he said.
Drbul also noted that increased gas prices probably took $6 to $7 out of the consumer’s weekly discretionary spending, which would have affected sales.
According to an April 9 report by Margaret Mager with Goldman Sachs, teen retailers showed significant strength in sales trends.
American Eagle, for example, posted a same-store sales gain of 29.2 percent. Shares of American Eagle rose 0.88 percent to close at $29.81 for the week.
However, cold and wet weather largely offset the positive impact of an early Easter at most retailers, said Citigroup Smith Barney’s Kimberly Greenberger. Denim sales were boosted by the cold weather, as consumers bypassed shorts in favor of warmer clothing. One retailer particularly hurt was Old Navy.
“We anticipate the lackluster March sales results, increased inventory, and the early Easter will lead to increased promotions in April,” said Greenberger.
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