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Excerpt from our Wall Street Breakfast, a one-page summary of this morning's key market-moving and stock-moving stories:

Gap Dims Outlook After 3Q Profit Falls [AP]

Summary: Retailer Gap Inc.'s woes continue: Profits dropped 11% in Q3 to $0.23/share ($189m), and it lowered its full-year guidance to $1.01-$1.06, down from $1.08-$1.12. Sales were unchanged at $3.86b, but same-store sales were down 5%. CEO Paul Pressler: "We are maniacally focused on our turnaround in the short run." But six months ago Pressler predicted Gap would by now already be headed up. This was Gap's ninth straight quarter Gap Inc Chart 17 11 06of sales erosion, which has spurred rumors its board may fire Pressler. Some investors are positive, citing increased financial discipline and trendier clothing; others say the lack of concrete customer reaction proves Gap has missed the mark. The poor performance wasn't a surprise because Gap already warned two weeks ago. Gap shares were down $0.22 yesterday, and another $0.45 after-hours, to $19.35.
Related links: Press Release. Conference call transcript: Q3 2006. Media coverage: Reuters, Bloomberg, WSJ. Commentary: Holiday Sales: Will Retailers See Red?Retailers Suffer Weak Sales in Run-Up to HolidaysGap's Employee Productivity Lags its PeersJim Cramer's Take on GPS.
Potentially impacted stocks and ETFs: Gap Inc. (GPS) • Competitors: Wal-Mart Stores Inc. (WMT), Hot Topic Inc. (HOTT), Abercrombie & Fitch Co. (ANF), American Eagle Outfitters Inc. (AEOS), Pacific Sunwear of California Inc. (PSUN) • ETFs: PowerShares Dynamic Retail (PMR), ST SPDR RETAIL ETF (XRT), iShares Dow Jones US Consumer Goods ETF (IYK)

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Source: Gap Sales Slide for 9th Straight Quarter