21st June 03:21
"Strong Retail Sales Jump-Start Economy"
Retailers Report Surprisingly Strong Retail Sales, Boosted by Warm Weather
The Associated Press
NEW YORK Aug. 7 -
The nation's retailers finally got a break in July as warm weather and heavy
discounting lifted sales above expectations, even for struggling department
The upbeat sales reports issued Thursday halted a sluggish trend seen since
last summer and raised hopes that consumers will be in the mood to spend for
the critical back-to-school season.
Sales picked up for most retailing sectors. Business was strong enough at
Wal-Mart Stores Inc. that the industry leader boosted its profit outlook for
the second quarter. Sears, Roebuck and Co., Target Corp., J.C. Penney Co.
Inc., and Gap Inc. were among the retailers reporting sales that beat
Even May Department Stores Co. eked out an increase in sales at stores open
at least a year, surpassing ****ysts' forecasts. Sales at stores open at
least a year, known as same-store sales, are considered the best indicator
of a retailer's health.
"It was a good month, and it may be a good omen for the second half," said
Michael P. Niemira, vice president of Bank of Tokyo-Mitsubishi Ltd. "Sure,
the month was promotional and weather helped, but this could be the start of
a much better trend."
Bank of Tokyo-Mitsubishi's same-store sales tally of 77 retailers was up 4.3
percent, well above the 3 percent gain Niemira expected. That compares to a
2.6 percent increase in the year-ago period.
Niemira said the results outpaced the 1.7 percent monthly average gain
during the January through June period, and was the best showing since June
2002, when the index posted a 5.1 percent increase.
The strong performance from retailers coincided with strong economic data
from the government.
The Labor Department reported that productivity the amount that an employee
produces per hour of work rose at an annual rate of 5.7 percent in the April
to June quarter. That was the best performance since the third quarter of
The department also said new applications for jobless benefits slipped by a
seasonally adjusted 3,000 to a six-month low of 390,000 for the work week
ending Aug. 2.