Consumer companies fell amid concerns about fashion trends and interest rates.

Lululemon shares fell after analysts at brokerage Jefferies warned the red-hot brand could face a cooling-off comparable to that suffered by out-of-favor Under Armour. Rival yoga chic brands such as Alo Yoga and Vuori are muscling in on Lululemon's core business while a fashion shift to wide-leg pants is slowing demand for its trademark leggings. Lululemon's total sales growth average, which was greater than 30% over the last 12 quarters, is now about 10%, the Jefferies analysts estimated.

Blue-jeans maker Levi Strauss shares rose after it said fiscal first-quarter earnings were boosted by strong growth in loose-fitting jeans, another indication that fashion currents are shifting against Lululemon. The National Retail Federation is calling for modest growth in economic activity and consumer spending this year, an outlook one brokerage said was reasonable.

"Inflation is cooling, supported by moderating wage growth, higher interest rates, and improvements in supply chain and housing costs," said strategists at brokerage Telsey Advisors Group. "Visibility into the timing of rate cuts is top of mind. Consumers remain worried about inflation, particularly on food and dining out, but overall confidence improved in the most recent month."

Conagra Brands rose after the processor of foods such as Slim Jim meat snacks reported better-than-expected fiscal third-quarter earnings and revenue. Defensive bias in the market also favored consumer-staples concerns.

Write to Rob Curran at

(END) Dow Jones Newswires

04-04-24 1821ET