Retailers rallied on Thursday on some good news in the sector.

The S&P Retail Index climbed 4% to 355.62 led up by some big winners like eBay ( EBAY), Amazon.com ( AMZN) and, surprisingly, women's apparel retailers.

eBay soared 8% to $21.10 a day after the online retailer reported better-than-expected earnings. While profit slumped 29%, the company beat analysts' forecast and issued a third-quarter forecast higher than Wall Street's expectations.

Amazon also made a big move on Wednesday, purchasing online shoe retailer Zappos.com. The company said it will buy Zappos for about $807 million in stock and will pay $40 million in cash and stock to Zappos employees.

Shares of Amazon grew 5.5% in afternoon trading to $93.70.

Women's retailers, a sector that had been under pressure months before the recession actually began, showed some signs of hope on Thursday.

Coldwater Creek ( CWTR) said that while it still expects a second-quarter loss between 5 cents and 7 cents a share, there are some improving business trends. Shares of the company rose 10% to $6.19 in afternoon trading and sent up shares of other retailers in the sector.

AnnTaylor Stores ( ANN) soared 16% to $9.93, Chico's FAS ( CHS) jumped 7.5% to $10.90, New York & Company ( NWY) shot up 14% to $3.60 and Talbots ( TLB) bounced 10% to $4.52.

While overall the retail sector was in the green, there were a few losers.

Pacific Sunwear of California ( PSUN) said it expects a bigger-than-expected loss in its second quarter as sales remain weak.

The news sent shares tumbling 11% to $3.03 in afternoon trading.

The company now expects a second-quarter loss between 22 cents and 24 cents a share, down from previous guidance of a loss in the range of 11 cents to 17 cents a share.

Shares of Safeway ( SWY) also tanked more than 8% to $18.56 after the grocer lowered its full-year outlook .

While the company beat analysts' expectations, it said, looking forward, that full-year earnings will now fall between $1.70 and $1.90 a share, compared to previous guidance of $2.10 to $2.30 a share.
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