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Stocks Lower, But This Surprising Industry Surges Past Buy Points | Stock News & Stock Market Analysis

Stocks remained lower Friday afternoon, but Nike (NKE) and other apparel stocks showed the retail sector is far from dead.

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The SPDR S&P Retail ETF (XRT) jumped 2.6%, rising above a 200-day moving average that has been in decline this year. The sector has been struggling with online competition and changing consumer preferences. Those worries seemed overblown Friday as many clothing and shoe retailers rallied.

Nike was one of the better stocks in the Dow Jones industrial average. The sportswear giant gapped out of a cup-with-handle base with a 57.35 buy point.

Surprisingly strong results from sports-apparel chains Foot Locker (FL) and Hibbett Sports (HIBB) seemed to boost Nike shares. Thinly traded Shoe Carnival (SCVL) was another industry member gapping up past a buy point. The stock soared 33% after the chain of sports and other footwear beat profit expectations. Same-store sales increased 4.4%.

But the Dow lagged with a 0.4% loss as other components sputtered. Just three days after a promising breakout, Coca-Cola (KO) was more than 3% below the 47.08 buy point.

The Nasdaq composite was flat while the S&P 500 eased 0.2%. Small caps led as the Russell 2000 added 0.6%. The index is gathering momentum after rising back above its 50-day moving average this week.

Volume was running higher compared with the same time Thursday. Friday is an options expiration day, which tends to increase trading.

Breadth was much better than the indexes suggested. Winners led losers by a 2-1 ratio on the NYSE and by 7-to-4 on the Nasdaq.

The apparel and footwear retail industry group was one of Friday’s best as it continued rising from the lower fourth of IBD’s 197 industry rankings. It ranked 85 on Friday.

Children’s Place (PLCE) broke out of an undefined base, clearing a 125.40 buy point and resistance around 120. The chain beat quarterly expectations on Wednesday and shares have continued higher.

Ross Stores (ROST) gapped up sharply, as it cleared a long consolidation in heavy trading following strong earnings. The stock receded from its morning peak at 73.94, trading near 71.60 in afternoon dealings.

Gap (GPS) climbed above the 29.87 buy point of a large cup with handle in big volume, but dipped below the entry during afternoon trading. Late Thursday, the store chain beat estimates with October-quarter EPS of 58 cents and sales of $3.84 billion. Same-store sales rose 3%, also above views.

Guess (GES) broke out of a flat base and was trading near the 174.64 buy point. Volume was 2-1/2 times more than average.

A few other stocks in the group cleared resistance levels, though not necessarily proper buy points. Abercrombie & Fitch (ANF) leapt past resistance around 15 after the company’s strong results.

Other consumer stocks and the energy sector were leading, while transportation, utility and some technology groups were down the most. Truck manufacturers and related stocks fell after Tesla introduced a battery-powered tractor-trailer model.

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