Gap’s stagnation breaks international deal’s enthusiasm

Thursday, 21 October 2010

Fall midterm sales have not had any effect on the FashionUnited Top 100 Index yet, as it fall yesterday by 18.62 down to 1175.19 points. This drop places the international apparel index below the Hang Seng, which kept its position around 1188.19.

In the United States, Gap Inc., a specialty retailer, updated investors on the company's initiatives to increase its share of the $1.4 trillion global apparel market, through a combination of international and online expansion and improvements in the North American business. "While never losing sight of our goal to gain market share in our North American , our strong portfolio of brands combined with several powerful platforms such as outlet, online and franchise give us significant global runway," said Glenn Murphy, chairman and CEO of Gap Inc.
"We're making the investments necessary to shift the balance of revenue over time to come increasingly from our online and international businesses." And, following its last trading session, they are going really be in a need of some brilliant investing and managing decisions, as their value sank yesterday by nearly 80%.

Markets are also expecting for American Apparel performance, as the American retailer is scheduled to announce earnings before the market opens on Thursday, October 21st. Looking at the analyst consensus, it appears most traders believe American Apparel is going to announce a loss of 11 cents per share. This loss has already been priced into the value of the stock so it is not presumed to be a great deal of price’s change. In the meantime, the last dance of the chic basics label has reported the company a decrease of 0.85%.

Sales of high-end apparel, accessories, watches and jewelry and other products may rise to as much as 170 billion euros ($236 billion) from 153 billion euros in 2009, helped by currency moves including the appreciation of the dollar, the consulting company Bain&Co. said in a recent study. Sales of leather goods will lead the increase, gaining 20 percent, according to their analysis. On other order of matters, sales of high end goods may climb this year to the highest level since 2007, led by demand in China and a rebound in the U.S., added the analysts.

It was precisely on Wednesday when the European parliament welcomed a key trade deal between the EU and Asia that is expected to open up the potentially-lucrative Chinese market to European companies. It comes after the Taiwan Textile Federation (TTF) and the European Apparel and Textile Federation (Euratex) signed a memorandum of understanding in Taipei, the Taiwanese capital.   Closer cross-border collaboration between Taiwan and the EU is expected to assist textile firms from Europe to make inroads into the vast mainland Chinese market. Stocks exchanges did not reported any reaction to this new deal yet, but they are to be expected, quoting various European Union officials.          

Finally and back to Europe, after a General Extraordinary Meeting in Stockholm aimed to introduce an incentive programme which will cover all employees of the H&M Group based on the same principles, the high street champion managed to increase its previous day’s performance but kept losing 1.8 points.

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