Strong US employment report this morning - 274,000 new jobs in April...
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And, in loosely related news, Americans continue to exercise buying power; at least, in some sectors.
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April Retail Sales Beat Expectations
Luxury and Teen Stores Had Strong Performances, But Discounters Trailed
By ELLEN BYRON Staff Reporter of THE WALL STREET JOURNAL
May 6, 2005
April sales for U.S. retailers managed to outshine relatively low expectations as shoppers continued to buy in spite of high gas prices and rising interest rates.
In a sign that middle- and upper-income shoppers are still spending, department stores turned in better-than-expected results last month, analysts said. Luxury retailers and teen stores reported particularly strong performances. But discounters, whose customers are most sensitive to rising gas prices, had lower-than-expected sales in April.
"It wasn't a blowout month by any means, but it wasn't a disaster, either," said Ken Perkins, president of Retail Metrics, an independent retail-research company. "The consumer continues to show resilience despite a relatively stagnant economy."
Monthly sales growth was the weakest since November, according to Thomson Financial's index of same-store sales, or sales in stores open at least a year. The index, which tracks results of 64 retailers, increased 2.2% in April over a year earlier. That still beat analysts' expectations of a 2.1% increase.
"The results in April were uneven, but there were clear pockets of strength," said Michael Niemira, chief economist and director of research for the International Council of Shopping Centers. "With all the worry that's out there about consumer confidence and gas prices, you don't really see much change, which says the consumer continues to be very robust," he said of retail sales so far this year.
Year-to-date through the end of April, the council's same-store sales index of about 70 retailers gained 3.6% from a year earlier. For May, the council expects same-store sales to increase 3% to 3.5% over a year earlier.
Same-store sales are a key indicator of a retailer's growth. Economists watch retailers' monthly sales as one indicator of U.S. consumer-spending trends. But the figures reflect only part of total consumer spending, as they don't include all chains. And some of the largest retailers, including Home Depot Inc. and Best Buy Co., don't report sales on a monthly basis. The monthly reports also miss other kinds of spending, such as many online purchases.
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