Retail Sales Are Up—Why Not Retail Stocks?

September retail same-store sales were better than expected, so why aren't retail stocks up?

Well, the big outperformers are up: Buckle , Abercrombie and American Eagle are up 7 to 9 percent, but most are not doing much.

There're several reasons for this:

1) a lot of retailers don't report comps — Ann Taylor, WalMart, Chico's, Talbots, J Crew, Urban Outfitters, and Children's Place among them.

2) sell on the news. Retailers had a big runup in the second half of September: the S&P Retail Index was up about 15 percent that month, far outperforming the 9 percent performance of the S&P 500.

3) traders are still trying to find stocks that will work for next year, and it's not easy. Abercrombie, for example, is still down 50 percent from where it was in 2008.

Still, this was a good series of reports: the consumer is not dead. They will come out for events like back to school.

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