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Goldman Downgrades Gap on Macro Picture

 (Image source: retailindustry.about.com)

The Gap Inc. (NYSE:GPS) was downgraded by Goldman Sachs Group Inc (NYSE:GS) from buy to neutral. The price target was cut from $42 to $40 a share. Goldman cited concerns for third quarter earnings and holiday season sales. According to Goldman, Gap’s weak September same store sales, which showed a slowdown in traffic is likely to continue for the holiday season and dampener third quarter earnings. Gap is not immune to the macro reality of the retail industry according to the report. The stock has been affected too much by the downgraded. I believe investors already have a good picture of the challenges facing the retail sector.