the retail sector was divided between winners and losers on wednesday reflecting the hardships that inflation is imposing on consumers who are clearly prioritizing essentials over nonessentials like clothing that is sending stocks in wildly different directions among gainers abercrombie  fitch anf soared more than 23 and kohl’s corp kss was up 9 after both companies surprised investors with a profit instead of expected losses but smaller clothing retailers express inc expr and children’s place inc plce were down 17 and 25 respectively after they reported widerthanexpected losses and cut their guidance shoe carnival inc scvl was down 5 after squeezing out a profit but falling short of analyst consensus estimates “our first quarter results were negatively impacted by the ongoing macrotension which resulted in outsized pressure on our core customer by limiting their purchasing power” children’s place chief executive jane elfers said in a statement at express which is the middle of an overhaul of its business to restore it to profitability chief executive tim baxter cited a combination of external factors and challenges in the store’s product assortments see here’s how lowe’s wants to target rural customers “the reduced consumer spending increased price sensitivity in discretionary categories and aggressive promotional activity across the industry that began in 2022 continued into the first quarter of this year and negatively impacted our performance” baxter said ubs analysts said they expect the softlines spending environment to deteriorate further through the year as new market research shows weakening demand “softline stocks have declined 5 yeartodate on average versus the sp 500’s 9 gain” analysts led by jay sole wrote in a note “therefore some investors are asking if softline stock prices can go much lower we believe the answer is yes” inflation is still a key issue for consumers with 65 of those polled in the research saying it’s also negatively affecting their view of the economy “we believe consumers will continue to feel the impact of lapping fiscal stimulus eg student loans over the coming quarters” the analysts said “we see elevated risk the us federal reserve’s interest rate hikes prove more harmful to consumer spending than anticipated” clothing retailers are taking the biggest hit in the current cycle as us consumers are deferring purchases at a greater rate than any other category that ubs tested the apparel purchase deferral rate has climbed 42 since the start of the cycle compared with 23 for other discretionary categories the analysts said overall consumers are planning to shop for sales more often to buy more storebrand products to take fewer shopping trips and to shop closer to home they said the winnersversuslosers trend is apparent in the sportinggoods retail space too with dick’s sporting goods inc dks outperforming smaller rival foot locker inc fl as well as nike inc nke  which was hit by a rare downgrade to sell on monday that sent its stock to a new 2023 low dick’s reported betterthanexpected profit and sales on tuesday as its core customer base of athletes purchased more purchased more frequently and spent more each trip according to chief executive lauren hobart see also hibbett profit and sales fall below estimates as shoppers buy footwear but shun apparel “dick’s continues to trend better than others in the space as the company is taking share while maintaining significantly better margins than in the past” said da davidson analysts on wednesday “while others in the space are missing and guiding down and are still struggling with higher inventories dick’s strong vendor relations which results in better and differentiated merchandising as well as strong internal operations continue to support doubledigit profits” the analysts said neil saunders managing director of globaldata said it’s clear that pressures are building in the retail sector but he’s not expecting a full collapse in consumer demand “rather it will result in shoppers becoming more selective about what they buy and where they shop” he said for abercrombie that’s good news as it’s on the right side of trends thanks in part to the skill of its management team which has succeeded in turning the business around from its “rather tarnished past” saunders said “in merchandise terms abercrombie continues to hit the right notes with its elevated casual offer and its range of relaxed styles for men and women it has also made great strides into growth areas of apparel such as activewear via its ypb ownbrand offer” he said at kohl’s the progress made in refreshing stores and merchandise has been slower he said despite management’s pledge to do better some 600 million to 650 million in capital expenditures has been set aside for store remodels “until these everyday fundamentals are corrected kohl’s will not be able to move forward” saunders said the spdr sp retail exchangetraded fund xrt was down 04 wednesday it is down 2 in the year to date while the sp 500 spx has gained 8 in that period also read north face makes up for weak demand for vans in vf corp’s results and shares rally