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Retailers Report Higher Sales
The nation's major retailers today reported generally upbeat sales results for October, despite rising fuel prices and falling consumer confidence, with high-end department stores and sellers of luxury goods reporting the biggest increases.
Signs that retail sales may be strengthening going into the busy holiday shopping season helped extend Wall Street's post-election relief rally. The Dow Jones Industrial average ended the day up 177.71 points, to 10,314.76. The Nasdaq, S&P 500 and other major financial indexes also posted gains.
Many economic analysts have expressed concern about consumer spending, the main engine of economic growth, in light of rising fuel prices, a sluggish job market and political uncertainty going into the election. But, the October sales results from major retail chains showed little signs of a slow down.
Shares of Wal-Mart Stores, the world's largest retailer and a component stock of the Dow Jones index, rose more than 2% today after the company said that comparable store sales in October rose 2.8% from the same period last year. (Comparable sales measure the results from stores open at least one year.) The October results met expectations, and the retail giant said it projects that November sales will rise 2% to 4%.
Target, the Minneapolis-based discount retailer, posted a 6% comparable sales increase in October.
"We are pleased with our sales for the month of October, which were at the upper end of our plan," Target Chairman Bob Ulrich said in a statement.
Many department stores and other mass merchandisers also reported positive results in October. J.C. Penney Co., for example, said that sales increased 2.1%, with sharp increases in the company's catalog and Internet operations. The chain raised its target for third-quarter profits in light of "positive sales momentum" and improved profit margin.
Federated Department Stores, which operates Macy's and Bloomingdale's, also raised its earnings projections after it reported that October comparable sales rose 4%.
Sears, Roebuck and Co. said that comparable store revenues rose 1.9%, which met company expectations.
"We were particularly pleased with our home appliance business, which showed strong sales growth due to customer response to innovative new products," Sears Chairman Alan J. Lacy said in a statement. "We were also pleased to see a sales increase in the home electronics business following our reset of the department, which was just completed in September."
The most impressive sales gains were reported by high-end retailers and specialty stores.
October sales at Nordstrom surged 11.5%, and Neiman Marcus Group reported a 13.5% gain, with top sellers including women's apparel, shoes, designer handbags and precious jewelry.
Limited Brands, which operates the Limited and Victoria's Secret stores, reported a 14% gain in comparable store sales.