Hot weather and clearance sales drew Americans into stores in July, giving retailers solid sales gains and helping offset worries about jobs and the economy.
Results came in better than expected for many retailers, an encouraging sign as the back-to-school season, the second-biggest shopping season after the Christmas holidays, kicks off.
Thomson Reuters reported early Thursday that three-quarters of retailers reporting results beat expectations in July.
“Hot weather and summer clearance, coupled with some newness in stores in the back half of the month, is leading to a nice upside heading into back-to-school,” said Ken Perkins, president of RetailMetrics, a research firm.
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He said colored denim is a new fashion trend attracting customers, and “retailers were pretty aggressive with promotions, trying to clear out merchandise.”
Analysts had expected modest gains in the month, as Americans slowly start to feel better about high unemployment and the bumpy global economy. On Tuesday, The Conference Board reported that its Consumer Confidence Index rose for the first time in five months. Still, that measure remains at historic lows, and is not expected to improve significantly until hiring picks up substantially. And a separate Commerce Department report Tuesday showed Americans spent no more in June than May, even though their income grew by 0.5%.
Only a handful of chains representing roughly 13% of the U.S. retail industry report monthly sales. Major chains that don’t report include Wal-Mart and J.C. Penney. The figures are based on stores open at least a year and are a key measure of retailers’ health because they exclude newly opened and closed stores. Economists watch the numbers because consumer spending accounts for 70% of U.S. economic activity.
via Retail stores report solid gains in July sales – USATODAY.com.