Robust earnings reports against China's warning

FashionUnited Top 100 Index closed on Wednesday at 1,183.76

points, rising by 2.78 amid retail stocks mixed in the wake of relatively robust earnings reports form a pair of the sector’s big names.

In the meantime, world markets retreated on concerns that China will tighten policy to cool rising inflation and curb growth.Stocks fell sharply after China's central bank announced it would raise the amount of cash that banks need to hold in reserve.Media reports said the People's Bank of China lifted the ratio of required reserve funds for several major lenders by half a percentage point.

In the reportedly most shocking movement of the day, Sir Stuart Rose, former Marks & Spencer CEO, decided to cut his shareholding in the retailer on the same his sucessor as chief executive Marc Bolland unveiled its route for the next three years. Sir Stuart sold £410,000 worth of shares after the retailer's half year figures yesterday, although this still leaves him with a stake of around 1.4m shares. Rose moved to become non-executive chairman of Marks and will leave the company altogether next January.

On the other side of Atlantic, Polo Ralph Lauren jumped to the first position within the Index after its second-quarter profits beat expectations. The fashion and luxury brands company said it expects sales in its fiscal year 2011 to rise by a low double-digit percentage, higher than it previously forecast. But the company also said margins would decline in the second half of the year because of rising labour, raw material and transportation costs. The American Dream's retailer yesterday reported net income of $205 million, or $2.09 per diluted share, for the second quarter of Fiscal 2011, compared to net income of $178 million, or $1.75 per diluted share, for the second quarter of Fiscal 2010. Their net income for the first six months of Fiscal 2011 rose 28% to $326 million from $254 million in the comparable period last fiscal year. Net income per diluted share of $3.30 in the first six months of Fiscal 2011 was 31% greater than the $2.51 achieved in the prior year period.

Also the exclusive American department store Macy's beat expectations, reporting a quarterly profit compared with a loss for the same period last year. According to trade publications, sales were higher than expected and the company reaffirmed its forecast for same-store sales in the fourth quarter to rise 3-4 per cent. The chain also edged its full-year profit outlook higher to a range above some analyst estimates.

Up to the date, several companies have reported increases in their quarterly results, including Adidas (up by 19%), Columbia Sportswear (up by 24%), Perry Ellis International (up by 2%), Puma (up by 3%), Timberland (up by 5%), Under Armour (up by 25%), Unifi (up by 27%) and VF Corporation (up by 7%). Among those which recorded falls were Nike (down by 8%) and Quiksilver (down by 12%).