June sales likely rained out for U.S. retailers
NEW YORK (Reuters) - Unseasonable weather and consumers without the stimulus boost they received last year were expected to have dampened U.S. retail sales in June, analysts said.
The month was "particularly challenging" for stores selling summer products as the first three weeks were cooler and wetter than usual, according to weather tracking firm Planalytics.
Overall same-store sales for U.S. retailers are expected to post a 4.8 percent drop, data from Thomson Reuters showed. The figure excludes Wal-Mart Stores Inc (WMT.N), which stopped reporting monthly sales earlier this year.
"The consumer is still up against too many hurdles to be spending too much money," said Patricia Edwards, a retail analyst for Storehouse Partners, pointing to factors such as mounting job losses and tight access to credit.
Department stores and apparel chains are expected to post among the worst sales declines in June with a 9.4 percent and 5.1 percent drop, respectively, as shoppers kept looking for deep discounts and reserved a big portion of their money for essential items.
Such consumer thrift has resulted in solid sales for only a handful of retailers in the past year, particularly discount giant Wal-Mart.
But the decision by the world's No. 1 retailer to stop reporting monthly sales has muddied the task of measuring consumer spending, which accounts for about 70 percent of the U.S. economy.
Wal-Mart had held about 50 percent of the weighting in the monthly average.
"If everyone else's sales (are) down and we don't know what Wal-Mart did, then you don't know if this is more systemic and all the consumers are pulling back hard, or if it's just that people are shifting their spending habits," Edwards said.
Without Wal-Mart, discount retailers are expected to post an overall same-store sales decline of 5.9 percent.
SUMMER DEMAND
Summer weather usually brings with it demand for items such as bathing suits, summer dresses and sandals.
But this June was the second-coolest in 10 years, with areas such as New York City, Boston and Chicago experiencing record rainfall, Planalytics said, dampening demand for such merchandise.
Last week, drugstore chain operator Walgreen Co (WAG.N), one of the largest retailers that still posts monthly sales, said the dismal weather hurt sales of seasonal items.
Only the last week of June showed a "strong turnaround" in temperatures, Planalytics said. Continued...
