What happened

Two days after Nordstrom Inc. (JWN -3.74%) fell 5%, the retailer was recouping those losses, riding a rally in the sector on promising reports from some of its peers. As of 11:07 a.m. EDT, the stock was up 5.5%.

So what

Retail stocks, which have been slammed recently on concerns about declining traffic, store closures, and e-commerce, finally got some good news today as Bed Bath & Beyond (BBBY) posted an upside earnings report and Victoria's Secret parent L Brands (BBWI -2.16%) reported better-than-expected monthly sales.

A Nordstrom department store

Image source: The Motley Fool.

At Bed Bath & Beyond, earnings per share of $1.84 beat expectations of $1.77, and comparable sales rose slightly by 0.4%.

Shares of L Brands were up 10% even though it reported comparable sales falling by the same amount. That drop was due both to exiting the swimwear and apparel categories, and to the shift in the Easter holiday; underlying comparable sales were about flat. Costco Wholesale also reported a 6% increase in comparable sales in March, adjusting for changes in gas prices.

Now what

Nordstrom peers like Kohl's and J.C. Penney also rallied, gaining more than 5%. The surge may be as much a reflection that retail stocks have sold off too much as it is an increase in confidence in the sector, since overall projections are still weak.

In a recent note Credit Suisse analysts expressed bullishness about Nordstrom's e-commerce operations, saying the company would soon reach the tipping point to sustained profitability.

Nordstrom is in a stronger position than its department-store rivals, but is still subject to general trends in retail, especially the headwinds in mall traffic. Expect the stock to continue to sway based on industry news. The retail sales report out next Friday could be the next big mover.