“Whoever said money can’t buy happiness simply didn’t know where to go shopping,” actress Bo Derek once said. Judging from rising earnings at high-end retail stores, a lot of people are seeking bliss in upscale brands.

At a time when midmarket retailers like J.C. Penney (NYSE:JCP) and Kohl’s (NYSE:KSS) are struggling, high-end chains are rolling in green as wealthy shoppers buoyed July sales. Across all market segments, July retail sales rose an average of 5% — down from June’s 7.2%, but still a measure of significant growth.

But Kohl’s sales dropped 4.6% in July, and while J.C. Penney sales edged up 3.3% for the month, that growth largely was driven by fine jewelry sales and more-upscale brands of clothing and accessories. Meanwhile, sales at luxury retailer Saks (NYSE:SKS) jumped a whopping 15.6%, privately held Neiman Marcus rose 7.4%, Nordstrom (NYSE:JWN) sales rose by 6.6% in the month and Macy’s (NYSE:M) was up 5%.

So why the disparity? Despite an economic slowdown that has low-to-middle income consumers running for cover, wealthy buyers (and aspiring luxury shoppers) are still indulging in some pricey retail therapy. MasterCard’s monthly SpendingPulse survey found sales of non-jewelry, luxury merchandise rose by 11.6% in July. And since the richest one-fifth of U.S. consumers account for 40% of total spending, what’s good for retail is usually good for retail stocks.

The proof is in the numbers. Nordstrom reported earnings of $175 million on Thursday — 20% higher than a year-ago. JWN stock rose 10% last week to $44.28 on the news and is trading at about 55% over its 52-week low of $28.44 last August.

Macy’s (which also includes high-end retailer Bloomingdale’s) on Wednesday reported second-quarter earnings of $241 million — a 64% increase over last year. The retailer’s stock rose almost 6% last week, to $25.55, and is trading at more than 34% above its 52-week low of $19 last August. As Saks prepares to release second-quarter earnings on Tuesday, its shares are trading at $8.80, 33% above its 52-week low of $6.60 last August.

Bottom Line: Luxury stores are now the retail industry’s cash cow. But here’s the caveat: Their target market — the wealthiest 20% of consumers — also is most heavily invested in the stock market. And when the market takes a hit — as it did last week — rich folks start to feel poorer and spend less on luxuries. So stock market volatility has many high-end retailers holding their collective breath heading into prime shopping season. After all, they remember well how the bottom fell out of high-end sales back in 2008.

What does that mean for stocks? Last week’s wild ride on Wall Street is probably not enough to scare off the entire population of well-heeled shoppers. But if that wild ride morphs into a sustained plunge, there will be no safe haven for luxury retail stocks. For now, high-end retailers are hoping for the best and planning for the worst. And that typically means paring back costs and keeping those inventories of Jimmy Choo boots and Prada bags lean.

As of this writing, Susan J. Aluise did not hold a position in any of the stocks named here.