Inditex and Milan drag markets into red

Inditex got the industry talking when managed to weight

the Spanish benchmark index down into the red after posting 22 percent increase in net profit yet disappointing the market. The stock dropped more than 3.5 percent Wednesday, becoming the worst company within the Ibex35.

Elsewhere, Italian stocks were clear leaders of the session in Europe, with the Milan Stock Exchange trading down in a session marked by disappointing results of some big blue-chips such as Enel and that for many offered an overall revival of pessimism, given the political uncertainty.

European markets closed dragged by a poorly performing Milan, London shedding 0.45 percent and Madrid dropping 0.4 percent. In contrast, Wall Street has closed on the rise, with the Dow Jones enjoying its ninth positive session on another record high. The Dow Jones gained 0.04 percent while Nasdaq rose 0.09 percent to 3,245.12 points.

Despite the gloom, and with the sole exception of Ferragamo, that lost 2.75 percent, Milan listed luxury stocks performed well. Luxottica added 1.39 percent, Tod´s advanced 0.53 percent, Stefanel gained 3.94 percent and Bruno Cucinelli closed up by 2.16 percent after the luxury menswear house posted normalised net income reached 26.5 million euro, reflecting a 26.2 percent increase when compared with the previous year.

In the UK, French Connection shares, which have lost 46 percent of their value over the past year, closed up 10.5 percent to 27 pence. The shares peaked at 4.87 pounds in 2004. French Connection posted a 10.5 million pounds pre-tax loss for the 12 months to January 31 as sales fell by 8 percent. Anusha Couttigane at retail consultancy Conlumino said from ‘The Telegraph’: “Whilst ten years ago the FCUK brand was synonymous with forward-thinking fashion, today French Connection seems to have lost much of its aesthetic definition.

According to the company records, French Connection made an operating profit of 6.2 million in North America, whipped off by the 16 million pounds loss registered across its UK and European markets, which like-for-like sales downed by over 7 percent. Nevertheless, the fashion chain CEO, Stephen Marks, remains positive: “Nine months ago we instigated massive changes. We are beginning to see the benefits, but it takes a long time in our industry,” he added. “Although it is very early days in the new year, we have seen a better performance in UK retail, and we expect this to build as the year progresses.”

Across the Pond, the Men's Wearhouse Inc. is scheduled to release its fourth quarter 2012 financial results before market open on Thursday. The company expects to report earnings of 0.01 dollars per share to 0.05 dollars per share for the fourth quarter. The stock closed 0.92 percent lower at 29.17 dollars on volume of 492,418. Finally, American Apparel Inc. shares ended sharply lower on Tuesday.