Tags: Sluggish | Holiday | Season | for | Retail

Sluggish Holiday Season for Retail

Friday, 04 Dec 2009 02:04 PM

 

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A decline in sales at the nation's retailers in November after two consecutive months of gains is an ominous warning sign for the holiday shopping season and for an economy in the early stages of a fragile recovery.

Many merchants may be forced to discount more than they planned to get financially strapped holiday shoppers to buy after last weekend's respectable bargain buying surge didn't offset weak spending for the rest of the month.

The 0.3 percent decline, according to the International Council of Shopping Centers tally, is worrisome because it comes on top of a freefall in November 2008 as spooked shoppers went into a defensive crouch after the financial meltdown. Analyst had expected a solid gain.

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According to sales results announced Thursday, a diverse group of stores including department store chains Macy's Inc., Saks Inc., teen merchant Abercrombie & Fitch Co. and discounter Target Corp. posted sharper-than-expected sales declines. Children's Place Stores Inc. was among the biggest disappointments, suffering a steep drop, though Wall Street expected a small gain.

Analysts caution that a better gauge of the month may lie in government retail sales numbers, slated to be released Dec. 11. The numbers offer a broader view of spending, including online sales and results from electronics chains - two bright spots for the holiday season, analysts said.

Thursday's figures also don't include Wal-Mart Stores Inc., the world's largest retailer, which stopped releasing its monthly figures after announcing April results.

Warm weather also was a factor in depressing shoppers' appetite for seasonal apparel such as coats, analysts said.

Nevertheless, November's buying trends show that Americans mostly will shop only when the bargains are deep.

"I think we are seeing the true stripes of the consumer," said BMO Capital Markets analyst John Morris. "She is still motivated by need rather than want."

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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