Why These Apparel Retailer Stocks Plunged on Wednesday
Shares of American Eagle Outfitters (NYSE: AEO), L Brands (NYSE: LB), and Abercrombie & Fitch (NYSE: ANF), well-known apparel retailers, all dropped sharply during trading Wednesday as new economic data looked bleak. American Eagle and L Brands both ended the day down more than 10%, while Abercrombie & Fitch was off 8.5%
Stocks declined Wednesday in part because of March retail sales, which plunged 8.7%, the worst monthly decline on record. It was far worse than February's revised 0.4% drop as consumer spending plunged, events and entertainment ground to a halt, and millions lost their jobs. Furthermore, U.S. manufacturing output dropped by the most in over 74 years as COVID-19 sent shock waves through supply chains and manufacturing.
The market is trying to find balance as investors grasp the reality that while we may be nearing a peak in daily deaths and new cases, we definitely have yet to see the worst of the economic fallout and its impact on companies.
Source Fool.com
