Jones Apparel yesterday reported a steeper-than-expected quarterly sales drop, stoking worries that Wall Street's recent optimism about holiday shopping has gotten ahead of itself. The New York-based maker of brands such as Nine West and Anne Klein emphasized that its quarterly profit rose 11 percent as it cut costs and clamped down on inventory to reduce markdowns. Net income in the third quarter was $30.4 million, or 36 cents per share, up from $27.3 million, or 33 cents per share, a year earlier. "There are less clearance racks, and supply and demand is in better balance," Jones CEO Wes Card told The Post. "Going into the holidays, that bodes pretty well." Still, quarterly revenue dropped by 11 percent to $855.7 million. That disappointed investors, who lately have been betting that department stores like Macy's and JC Penney have beefed up their initially conservative bets on fall and holiday fashions. Jones shares, which have soared 90 percent recently, yesterday tumbled $1.06, or 6 percent, to close at $16.63.

Originally published by JAMES COVERT.

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