H&M shares surge on fewer fashion markdowns

Shares in H&M surged after the ailing Swedish clothing retailer reported first-quarter profits that beat expectations on lower clearance sales.

The shares rose as much as 16% after the company pulled back on discounts, compared with the fire sale it held a year earlier. The gains may have been spurred by “short squeezes”, when a bit of good news spurs investors who have bet against the stock to rush to reverse positions. The shares have still lost more than half their value since their 2015 peak.