eBay, Wal-Mart warnings stir holiday sales concerns
SAN FRANCISCO (Reuters) - EBay Inc (EBAY.O: Quote) on Wednesday joined Wal-Mart Stores Inc (WMT.N: Quote) in cutting its outlook for the all-important holiday season, suggesting that the fourth quarter may turn out to be weaker than some analysts predicted as recently as last week.
The warnings from two of the retail industry's most influential players comes as investors re-assess the state of the global economy after weak data this week from the two largest countries, the United States and China.
EBay and Wal-Mart blamed divergent factors such as food stamp reductions and unfavorable search-engine optimization for the lower outlooks.
Both complained about the stronger dollar putting the skids on their forecasts, lowering the value of overseas sales once converted into the U.S. currency.
But analysts say stagnant incomes are also prompting U.S. consumers to curtail spending.
"EBay, especially on the marketplaces side, is actually suffering from company-specific setbacks," Wedbush Securities analyst Gil Luria said. "But overall, if e-commerce was growing faster or as fast as it was last year or a couple years ago, it would have probably helped them hide that."
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EBay's fourth-quarter outlook was undercut by the strength of the dollar against the British pound, the euro and the Australian dollar, which together account for 35 percent of eBay's volume. Continued...