Shares of Jo-Ann Stores, Inc. (NYSE: JAS) got a pop this morning after the national fabric and craft retailer reported a narrower-than-forecasted loss in the second quarter and issued an encouraging outlook for 2009 after Wednesday’s close.

Net sales increased 3.7% in the quarter, while same-store sales increased 3.3% compared with a 7% increase for the same period last year. Gross margins improved 190 basis points to 47.6% from 45.7% in the second quarter of the prior year, but on account of lower sales of clearance merchandise.

Looking ahead, management raised its outlook for fiscal 2009 based on a better-than-expected first half, stating that it “expects year-over-year improvement in its performance.”

Shares gained 12%, or $2.78, to $25.45 in the first half hour of trading. For detailed price information and news stories on Jo-Ann Stores, click JAS.