This morning's

positive outlook for a second-half recovery from broadline retailer

Wal-Mart

(WMT) - Get Report

may bode well for the economy, but not so much for the rest of the retail sector. Wal-Mart said earlier today in an earnings announcement that it expects to return to double-digit growth in the second half of 2001.

While the upbeat forecast could push Wal-Mart and other broadline retailers higher, analyst Bill Dreher of

Robertson Stephens

doesn't think that the entire sector will continue to see the upward stock movement that it has in that past six weeks. The all-encompassing

Dow Jones U.S. Retail Index

has climbed 14% since March 22, but lost 1% today. The more specific

Dow Jones U.S. Broadline Retail Index

has gained 12.3% in the same span, but fell 2.8% in today's session.

Dreher thinks that "consumers are not spending hand over fist," but "they're still opening their wallets." He believes that consumer spending has leveled off, and that as a result of the market downturn of the last year, broadline retailers are stealing market share. When consumers have less money to spend, they look for the better values -- at broadliners like Wal-Mart. By the time the economy picks back up again, consumers may have already formed a loyalty to the less-expensive stores, having realized they can get better deals. Wal-Mart, for example, "has tremendous volume in grocery store items, which increases the frequency of shopping visits," Dreher said.

"That's not to say that everyone can benefit from leveled-off consumer spending," said Dreher. "I think the consumer is learning to be smarter with expenditures." The analyst has buy ratings on Wal-Mart,

BJ's Wholesale

(BJ) - Get Report

,

Federated Department Stores

(FD)

and

Kohl's

(KSS) - Get Report

-- individual success stories that Dreher said aren't moving as part of a general sector uptrend.

Stacy Pak, a softline retail analyst at

Prudential Securities

(softline being mostly apparel retailers) has a somewhat more optimistic outlook for the retail sector as a whole. "It's not time to exit the group, but may be time to reallocate assets within the group," she said. "Our thesis is that the group will continue to outperform based on attractive valuations."

Pak's top picks are

AnnTaylor

(ANN)

, up 3.8% today to $34.47, and

Abercrombie & Fitch

(ANF) - Get Report

, down 0.3% today to $39.22. Both have seen recent upward trends since the beginning of April.

"Wal-Mart, Kohl's and BJ's are going to continue to show nice comparable-store sales increases in the second quarter and the rest of the year," Dreher said. Despite Wal-Mart's rosy outlook earlier, the stock still fell 2.5% today to $53. The stock has climbed 15.9% since March 22. Dreher has a 12-month price target of $59 on the nation's biggest retailer.

Kohl's fell 1.2% today, but has gained 17.8% since April 12. BJ's slid 0.5% to $42.80 today and has fallen 2.7% since the end of March. Federated lost 0.9% to $43.55 today.

J.C. Penney

(JCP) - Get Report

posted first-quarter earnings that were in line with estimates this morning, but the retailer lowered its guidance for the next quarter. The stock fell 5.3% to $19.94 today.