Monday, May 25, 2009

Retail Sales

NEW YORK (CNNMoney.com) -- Retailers logged a second straight month of sales declines in April as consumers continued to pull back on all types of unessential purchases, the government reported Wednesday.

The Commerce Department said total retail sales fell 0.4% last month, compared with March's revised decline of 1.3%.

Sales in March were originally reported to have declined 1.2%. Economists surveyed by Briefing.com had been expecting April sales to be unchanged from the previous month.

0:00/03:09Shoppers are back. Really?

"This is a disappointing report," Ian Shepherdson, chief U.S. economist with High Frequency Economics, said in a report.

"The downward revisions to March makes the story even more troubling," said Michael Niemira, chief economist with the International Council of Shopping Centers (ICSC).

Sales excluding autos and auto parts fell a surprising 0.5%, compared to a decline of 0.9% in March.

Economists had forecast April sales, excluding auto purchases, to rise 0.2% from the previous month.

Niemira said he was "puzzled" by the broad declines in core April retail sales given that many merchants, including Wal-Mart (WMT, Fortune 500), had reported much better-than-expected same-store sales earlier in the month that were partly boosted by a pick up in Easter-related shopping.

Same-store sales -- a key gauge of a retailer's performance -- measure sales at stores open at least a year.

"The government numbers don't mesh with retailers' April same-store sales results," he said. "We need to be cautious to not overinterpret these numbers because they don't capture the tone of what retailers are telling us. We could likely see upward revisions to April numbers next month."

The government report showed electronics sellers suffered a 2.8% sales decline in April, clothing sellers logged a 0.5% dip in monthly sales and sales at general merchandise stores slipped 0.1%.

Elsewhere, department store sales fell 0.2% and furniture sales declined 0.5%. Gasoline station sales dropped 2.3%

But building materials purchases rose 0.3% and sales at vehicles and auto parts dealers increased 0.2%.

"The categories that I had expected to be weak like cars and building materials were up and categories that I thought would increase such as general merchandise sales were down," Niemira said. "So these results were really mixed against my own expectations."