Retailers: Surprise For Some On Guidance

Well, the retailers came in generally in line with the gloomy expectations: plenty of markdowns on warm weather. Two-thirds were below expectations, according to RetailMetrics. Department stores missed expectations across the board.

But--here's the surprise: a handful either reaffirmed or had positive guidance: Talbots,Gap,Aeropostale,Pacific Sunware, Gymboree,Christoper and Banks all guided higher. Most talked about decent margins and being able to maintain inventory levels. And a few--Target & Gap for example, beat sales expectations.

Remember--this is one of the most heavily shorted sectors on the Street---down about 15% in the last month alone. Any even modestly positive commentary is going to move these stocks up.

Bottom line on retailers: fewer companies warning on the bottom line, and a surprising number have kept or improved estimates. Can you say short covering? At least at the open.

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