Ugly Day for Retailers -- Wednesday's IP Market Recap

It wasn’t quite a Merry Christmas for retailers and investors paid the price as the sector suffered the majority of losses in Wednesday’s trading. Adding to the gloom contained in an east-coast winter storm was a lack of any progress in budget talks, even as President Obama left the warmth of Hawaii to fly back to Washington and try to make a deal.

The net result was a loss on the day despite some good news on the housing front, as the Case-Schiller Index showed another rise in new home prices in October. The Nasdaq took the biggest fall, dropping 0.74% to 2,990.16, while the S&P 500 lost 0.48% to 1,419.83 and the Dow fell 0.19% at 13,114.59.

Retailers winced on news of weakness in sales in the eight weeks leading to Christmas. The sector, once again, was down broadly on the day, led by Michael Kors (NYSE:) which was down nearly 7% by the end of the trading session.

Sector mates Coach (NYSE:, -5.9%), Abercrombie & Fitch (NYSE:, -3.5%), and Ralph Lauren (NYSE:, -3.3%) also saw shares sink on the news. E-tailer Amazon (NASDAQ:) tumbled as well, falling just under 4%.

Bucking the trend was J.C. Penney (NYSE:) which maintained Monday’s momentum from a “buy” recommendation from

Oppenheimer (NYSE:). Penney closed on Monday up over 1% and added another 4%% today.

Also basking in some good news was Research In Motion (NASDAQ:), which saw shares climb over over 11% on no particular news. Herbalife (NYSE:) also rose just over 5% after hiring a strategic advisor and announcing it will hold an analyst and investor meeting next month in response to comments from hedge fund manager Bill Ackman.