NEW YORK ( TheStreet) -- Retail stocks are in the red, weighed down by some disappointing first-quarter earnings reports and a broader market made jittery by Europe's debt crisis.

The S&P Retail Index was down 1.9% to 433.81.

New York & Co. ( NWY) tops the New York Stock Exchange's list of biggest decliners, plunging 15.8% to $4.46 after posting yet another loss in its first quarter.

The women's apparel retailer said it lost $4.9 million, or 8 cents a share, virtually unchanged from the year prior. Sales rose 2% to $237 million, while same-store sales inched up 2.9%.

Still, New York & Co. foresees a bigger loss in its second quarter, though it didn't provide specific guidance.

Sears ( SHLD) shares were falling 6.3% to $93.26 after it, too, issued disappointing results Thursday.
Sears

The department store reported first-quarter earnings that plunged 38% to $16 million, or 14 cents a share. While same-store sales rose 1.5%, higher costs and markdowns hurt margins.

Hot Topic ( HOTT) was another loser Thursday, swinging to a loss in its first-quarter. The teen retailer took a hit from the elimination of Twilight merchandise from its stores and forecast a deeper loss in its second quarter.

As a result, shares were plummeting 9% to $5.94 in midday trading. Walgreen ( WAG) was taking a hit after it was downgraded to neutral.

Credit Suisse lowered its rating on the drug store and cut its price target to $36 from $42. "While Walgreen's plan to slow growth, cut costs, and enhance store productivity has yielded some positive results, we have been generally disappointed with the repositioning to date," analyst Ed Kelly said in a research note.

Shares of Walgreen were falling 4.4% to $33.29 in morning trading. The downgrade also pulled down shares of other drugstores. Rite Aid ( RAD) was falling 2.9% to $1.16, while CVS Caremark ( CVS) was off 1.8% to $34.31.

Other casualties included Saks ( SKS), which was sinking 6.2% to $8.43, Netflix ( NFLX), which was dropping 3.8% to $97.04, Borders ( BGP), down 7.8% to $2.25 and Crocs ( CROX), off 8.2% to $9.07.

But even amid the blood bath there were some notable gainers. Williams-Sonoma ( WSM) shares were climbing 5.8% to $30.08 as it upped its 2010 outlook to a range of $1.39 to $1.48 a share, from prior forecast of $1.16 to $1.26 a share. It also lifted its second-quarter guidance to 20 cents a share from 16 cents.

In its first quarter, Williams-Sonoma earned 23 cents a share on an adjusted basis, nearly double Wall Street's consensus of 12 cents a share.

American Apparel ( APP) shares were recovering some of Wednesday's steep losses. The company hit a new 52-week low during the previous session, but was surging 8.6% Thursday midday to $1.77. The retailer said it had received a delisting warning, may not be in compliance with a covenant under its credit agreement, and widened its first-quarter loss.

Children's retailers Gymboree ( GYMB) and Children's Place ( PLCE) were also edging higher Thursday after both reported better-than-expected first-quarter earnings.

While Gymboree released a second-quarter outlook that fell short of estimates, Children's Place lifted its full-year forecast to range that could top expectations.

GameStop ( GME) were gaining ground. The video-game reatailer's first-quarter results also beat analysts' predictions.

During the quarter GameStop earned $75.2 million, or 49 cents a share, while sales grew 5% to $2.08 billion. This is the first time sales topped $2 billion in a non-holiday period.

Still, GameStop said it expects second-quarter earnings in the range of 25 cents to 27 cents a share, just shy of the consensus target of 29 cents.

--Reported by Jeanine Poggi in New York.

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