Make us your home page
Instagram

Retailers report best sales growth since March

NEW YORK — This summer, Americans were walking contradictions: They opened their wallets despite escalating fears about the slow economic recovery and surging gas prices.

A group of 18 retailers ranging from discounter Target to department store chain Macy's reported August sales on Thursday that rose 6 percent — the industry's best performance since March — according to the International Council of Shopping Centers, a trade group.

The news appears to show that what Americans say and do are two different things: The report comes two days after a private research firm said consumer confidence in August fell to its lowest level since November 2011 as Americans grew more concerned about the job market, business conditions and the overall economy.

"This is bit of a head scratcher," said Mark Vitner, a Wells Fargo Securities senior economist. "This runs counter to most of the other data related to the consumer."

The revenue gains in August, which factor in only stores that were open at least a year, are better than the 4 percent to 5 percent increase Wall Street predicted at the start of the month. And it was the best performance since March, when stores collectively posted a gain of 6.8 percent. Except for a shopping lull in June, stores have seen a healthy pace of 4 percent to nearly 7 percent growth since the start of the year. But analysts worry that Americans are shopping now only because they are buying necessities for their children for back-to-school, and that the healthy spending won't last.

"It's certainly strong on the surface. But is it a sign of an improving economy and retailing environment? Or is it just more of the same: Shoppers were driven by need?" said Michael P. Niemira, chief economist at the International Council of Shopping Centers.

Stores certainly benefited from people shopping for supplies and clothes for back-to-school, the second-biggest shopping period of the year. Many department and clothing stores like Macy's and the Gap had better-than-expected results as trendy fashions like brightly colored jeans caught shoppers' attention.

The Gap, which filled its stores with fashions in hot pinks, coral blues and aqua greens, posted a 9 percent gain, as back-to-school shoppers headed into its chains, particularly Old Navy. The results beat analysts' expectations of a 5.4 percent rise.

Target also reported better-than-expected results. It had a 4.2 percent gain in August, better than the 3.1 percent increase that Wall Street expected. Business was strongest in food, and health and beauty items, but shoppers also bought clothing and home furnishings, the discounter said.

Macy's 5.1 percent gain also was better than the 3.6 percent forecast. The company said its men's apparel, home furnishings, beauty products, women's shoes and handbags continue to perform well.

The strong sales reports give retailers some reason to be optimistic as they look toward the busy winter holiday shopping season, the busiest period of the year, in November and December.

Other economic news

• Consumer spending rose 0.4 percent in July from June, the Commerce Department said Thursday. That followed no change in June and a slight decline in May. Incomes grew 0.3 percent, matching the gains from May and June. The savings rate after taxes dipped to 4.2 percent in July from 4.3 percent in June, which was the highest rate in a year.

• The number of Americans seeking unemployment benefits was unchanged last week at a seasonally adjusted 374,000, suggesting slow improvement in the job market. The Labor Department said Thursday that the four-week moving average, a less volatile measure, increased to 370,250. When applications fall consistently below 375,000, it generally indicates that hiring is strong enough to lower the unemployment rate.

Retailers report best sales growth since March 08/30/12 [Last modified: Thursday, August 30, 2012 8:17pm]
Photo reprints | Article reprints

Copyright: For copyright information, please check with the distributor of this item, Associated Press.
    

Join the discussion: Click to view comments, add yours

Loading...
  1. UPS relocates express operations from St. Pete-Clearwater to TIA

    Airlines

    TAMPA — United Parcel Service Inc. is switching airports for its express air operations. Beginning in October, UPS will relocate from St. Pete-Clearwater International Airport to Tampa International Airport.

    Beginning in October, UPS will move from St. Pete-Clearwater International Airport to Tampa International Airport. [Associated Press file photo]

  2. Richard Corcoran takes aim at public financing of campaigns

    State Roundup

    TALLAHASSEE — House Speaker Richard Corcoran, R-Land O'Lakes, may not be running for governor — not yet anyway — but his latest idea will get the attention of those who are.

    House Speaker Richard Corcoran, R- Land O’ Lakes, is proposing an end to public financing of campaigns. [SCOTT KEELER | Tampa Bay Times]
  3. Related Group breaks ground on complex at old Tampa Tribune site

    Real Estate

    TAMPA — When Miami developer Jorge Perez first eyed a 4.2-acre tract on the west bank of the Hillsborough River two years ago, people asked him if he wouldn't prefer to build on the opposite side closer to the downtown core.

    No way.

    From left, Related Group executive associate Arturo Penaa, Jorge Perez, center, founder and CEO of the Related Group, Mayor Bob Buckhorn and Steve Patterson, the President of Related Development dig their shovels  during the groundbreaking ceremony of the 400 unit Riverwalk Manor apartment complex on site of the old Tampa Tribune building on Wednesday. [OCTAVIO JONES | Times]
  4. Eat 3-course meals for $35 at these 100 restaurants for Orlando's Magical Dining Month

    Food & Dining

    In the early 1900s, hotels offered "table d'hote" or "prix fixe" menus as a form of loss leader. Hotels didn't necessarily make money on these lower-priced, multi-course meals, often served at communal tables, but they made up for it on the booze. Prohibition may have contributed to a gradual shift toward a la carte …

    Bulla Gastrobar serves a variety of Spanish and Portuguese dishes.
  5. Plant City farmer hopes robot pickers can save strawberry industry from shrinking labor force

    Agriculture

    PLANT CITY — If current trends continue, the region's status as a major strawberry producer will depend in large part on what happens in Mexico.

    Strawberry pickers work during the daytime, when fruit is more likely to bruise. Machine pickers can work at night. The owner of Wish Farms in Plant City is developing automated pickers and hopes to see them at work on a widespread basis in five years. [Times file]