Macy’s posted its strongest fiscal first-quarter comparable sales performance in four years on Wednesday, as the legacy department store’s turnaround continues to show progress. 

Led by the 200 so-called reimagined stores Macy’s has upgraded, comparable sales grew 3% overall during the quarter and 1.6% at its namesake banner.  

At Bloomingdale’s, comparable sales grew 10.2%, helped by an array of buzzy brands, a “fun factor” unique in the luxury landscape and the recent bankruptcy of rival Saks Fifth Avenue, CEO Tony Spring told CNBC in an interview. 

“Is the disruption in the marketplace helpful to us? Sure,” he said. “Is it the primary reason we’re growing? No.” 

Spring said better-than-expected sales and profitability led the company to raise its full fiscal-year guidance after previously taking a cautious outlook. 

It’s now expecting 2026 net sales to be between $21.5 billion and $21.75 billion, largely ahead of expectations of $21.59 billion, according to LSEG. It anticipates adjusted earnings per share will be between $2 and $2.20, up from a previous range of between $1.90 and $2.10 and well ahead of expectations of $2.07 at the middle and high end, according to LSEG.

It now expects comparable sales to climb between 0.5% and 1.2% for the year, versus a previous outlook of a 0.5% drop to a 0.5% increase.

Macy’s shares were up more than 2% in premarket trading Wednesday.

Many retailers have reported strong growth during their fiscal first quarters in recent weeks due in part to higher-than-usual tax refunds. Some companies issued more cautious guidance for the current quarter over concerns less stimulus in the economy could lead to slower demand, especially as shoppers pay more for gas due to the war in the Middle East.

Spring said tax refunds “definitely” helped during the first quarter, but weren’t the only reason why Macy’s grew. Crucially, the same trends the company saw during the first quarter have so far continued into the second, he said. 

“We did raise our guidance in both sales and profit for the remainder of the year to reflect the business trends that we’re seeing as we start the second quarter, so pleased with the second quarter to date and the breadth of the categories that are performing,” said Spring. “Don’t see any significant change in the consumer approach to our categories and our business across all three of our name plates.” 

He said the steady consumer behavior led Macy’s to hike its outlook “despite the macroeconomic and geopolitical uncertainty.”

Here’s how the department store did in its fiscal first quarter compared with what Wall Street was anticipating, based on a survey of analysts by LSEG:

• Earnings per share: 13 cents adjusted vs. 3 cents expected
• Revenue: $4.68 billion vs. $4.61 billion expected

The company’s reported net income for the three-month period that ended May 2 was $63 million, or 23 cents per share, compared with $38 million, or 13 cents per share, a year earlier. Adjusting for restructuring costs and other one-time charges, Macy’s posted earnings per share of 13 cents.

Sales rose to $4.68 billion, up about 2% from $4.60 billion a year earlier. 

Macy’s is about two years into a three-year turnaround that Spring has spearheaded since taking over as the retailer’s chief executive. It’s included closing underperforming stores at dead malls across the country and reinvesting in the ones it decided to keep open.

Those investments have included a focus on retail fundamentals, like ensuring stores have enough staff, are enjoyable to spend time in and are stocked with items people actually want to buy.

“We’re not doing the fancy stuff, we’re doing the stuff that makes the biggest difference in the business,” said Spring. “We are really focused on product, we are really focused on taking care of the customer, and I think the results show that when we do those two things consistently, and we don’t get bored, we stay relentless in our commitment, we get the results we’re looking for.”

Market indices plunged on Monday. Japan’s Nikkei 225 fell by around 5.2% on Monday, while South Korea’s KOSPI sank by 6.2%. Vietnam’s VN-Index is down by around 5.7%. Other Asian markets dropped by smaller amounts: Hong Kong’s Hang Seng Index fell by around 1.8%, and India’s NIFTY 50 is down by 2.5% in morning trading.

Monday’s plunge adds to a steep slide in Asia’s markets since Trump’s Iran strikes. The KOSPI is down by over 16% since the Iran war began. Japan’s Nikkei 225 and Australia’s ASX 200 are down by around 10% and 6% respectively over the same period.

Many Asian economies rely on oil exports from the Gulf, which have slowed to a crawl since Iran closed the Strait of Hormuz last week. South Korea sources about 70% of its crude oil from the Middle East; for Japan, that number is closer to 90%. The price of WTI crude briefly surpassed $115 a barrel on Monday morning. 

The energy shock has reversed a rally in Asia’s AI-linked, tech-heavy growth stocks that had soared in the weeks just ahead of the Gulf conflict. South Korean chipmakers Samsung Electronics and SK Hynix both surged on the back of soaring demand for memory chips. At one point, the two companies together eclipsed the combined valuation of Alibaba and Tencent.

Samsung and SK Hynix have now both dropped by around 20% respectively since U.S. strikes began.

China, by comparison, has proved less volatile than its neighbors, due to its long-term energy planning and massive stockpiles of oil. The CSI 300 index, which tracks stocks traded in Shanghai and Shenzhen, is down by only 2.3% since the war began. 

“If the current Middle East situation continues to persist, China could even be a potential beneficiary of rotation out of Northeast Asian markets,” notes BNP Paribas analyst William Bratton in a March 9 report.

The U.S. stock market has also held relatively steady, with the S&P 500 falling by just 2.0% over the past week. The U.S.’s status as a major oil producer has helped to cushion its economy from the effect of reduced supplies of Middle Eastern oil. 

Still, U.S. investors could be realizing the full extent of the Iran war’s economic repercussions. S&P 500 futures are down by around 1.5%, as of 2:00am Eastern time.

Despite the short-term sell-off, Goldman Sachs’ analysts have urged investors to view the KOSPI’s decline in the context of an exceptional 176% increase since April 2025. 

“We view the pullback as a correction that will likely be followed by a recovery to new highs after a period of consolidation,” the firm’s analysts wrote in a March 6 report.

Other analysts agree that markets will likely recover from the Iran strikes in the long-run. 

“We expected a knee‑jerk risk‑off market reaction,” says Eli Lee, chief investment strategist at OCBC‑owned Bank of Singapore. “But barring an oil shock, history shows that geopolitical events typically do not negatively impact equity prices on a prolonged basis.”

The Nifty IT index closed February around 20% lower, while the tech-heavy Nasdaq declined only 4% during the same month. Experts highlighted structural differences in index composition as the reason for the divergence in the performance of ETFs benchmarked to the two indices.

“The Nasdaq comprises hardware, platform and product-led technology companies which include AI chip makers, cloud hyperscalers and software product firms which form the core of the AI value chain. The top tier AI value chain companies monetize directly through IP ownership, product sales, and platform economics translating into strong earnings and premium valuations,” said Dhanshree Jadhav, Analyst – Technology at Choice Institutional Equities.

Structural difference between Nasdaq and Nifty IT:

On the other hand, the Nifty IT index is dominated by services-led IT players acting as “integrators rather than creators” of AI, the analyst explained. “AI-led automation raises near-term concerns around pricing pressure, productivity pass-through to clients, and slower revenue growth, as enterprises seek to capture efficiency gains. This has weighed on growth visibility and valuations despite healthy deal pipelines. The Indian IT sector is facing near-term headwinds as AI begins to disrupt the traditional labor-arbitrage model. The current divergence reflects a broader shift in business models, where companies proactively investing in AI-led platforms, solutions, and capabilities are better positioned to navigate the evolving risk environment,” Jadhav said.

Ajit Mishra, SVP of Research at Religare Broking, said that the divergence between the Nifty IT index and the Nasdaq‑100 Index largely reflects their different positions in the evolving AI ecosystem. He also added that US technology leaders view AI as a powerful new growth platform. “Companies such as Nvidia, Microsoft, and Alphabet Inc. are directly monetizing AI through semiconductor leadership, cloud infrastructure, and software ecosystems, positioning AI as a significant revenue multiplier,” he added.

Indian IT firms, however, largely operate on a services-driven model. Investors fear that advanced AI tools could automate large parts of coding, testing, and maintenance work, potentially putting pressure on billing models and margins, Mishra explained, adding that sentiment weakened further after Anthropic introduced Claude Code, which triggered concerns across the global IT services space and contributed to weakness in companies such as IBM.

What should investors do?

According to Jadhav, this phase should be viewed as an industry-wide reset toward structurally stronger, AI-integrated operating models rather than a permanent structural disadvantage for Indian IT in the AI era.

“While near-term pressure is evident, AI-led digital transformation could also create meaningful long-term opportunities for Indian IT companies as enterprises accelerate modernization. Investors should closely monitor how these technological developments translate into deal pipelines and order flows in the coming months, though the sector may continue to face pressure in the near term,” Mishra, meanwhile, said.

Several popular ETFs linked to the Nifty IT index, including Nippon India ETF Nifty IT, HDFC Nifty IT ETF, ICICI Prudential Nifty IT ETF, Mirae Asset Nifty IT ETF, Kotak Nifty IT ETF, SBI Mutual Fund-SBI ETF IT, and Axis Nifty IT ETF, declined 20-21% in February, according to data on NSE.

Motilal Oswal Mutual Fund’s Nasdaq 100 ETF meanwhile, fell a little over 5% during the same duration. Motilal Oswal Nasdaq Q 50 ETF fell only 1% during the same month, despite AI worries.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)