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Retailers report April sales that show a slowdown in spending from previous month
NEW YORK (AP) ' Americans were shopping in April, but they weren't spending as much as expected.
Big retailers including Costco, Macy's and Target on Thursday reported sales in April that missed Wall Street estimates as colder temperatures, an early Easter and renewed worries about the economy dampened shoppers' enthusiasm to buy.
The disappointing results follow strong gains in the previous month that were boosted by a combination of warmer weather and optimism amid a flurry of positive economic news.
"Early results show there was a sequential slowdown from a particularly strong February and March," said Ken Perkins, president of Retail Metrics LLC, a research firm. "Weather cooled and consumer took a bit of a breather. But spending is still decent."
Only a handful of retailers report monthly figures based on stores open at least a year, a measure that's considered an indicator of a merchant's health because it excludes results from locations that open and close during the year. Still, economists and other industry watchers say the figures are an important barometer because the numbers offer a snapshot of consumer spending, which accounts for more than 70 percent of all economic activity.
Last month, analysts were optimistic that Americans who had cut back on spending during the slow economy were beginning to come back when a tally of 22 retailers posted a 4.1 percent gain in monthly sales. But April was a different story.
New reports on jobs and housing are raising concerns that the economic recovery is facing a spring slowdown for the third straight year. And the stock market rally also has lost some steam in recent weeks amid worries about the European financial crisis and the economy at home.
The bad economic news coupled with other factors hurt retailers' sales. For instance, analysts believe an earlier Easter, which was on April 8 and occurred 16 days earlier than last year, pushed sales out of April into March. They also think that an unusually warm February and March pulled forward some sales that would have normally happened in April.
Retailers tend to study the combined March and April figures because it's a better gauge of spending for spring. But many also say that May will be a better indicator of shoppers' behavior.
Here's a snapshot of April results:
'Costco Wholesale Corp. said its revenue from stores open at least a year rose 4 percent in April, while analysts polled by Thomson Reuters had estimated a 5.1 percent increase from the wholesale club operator.
'Target Corp. said its sales rose 1.1 percent in April, below the 2.8 percent increase in stores opened at least one year analysts had expected.
'Macy's Inc., which runs Bloomingdale's in addition to its namesake stores, reported a 1.2 percent increase in April. That misses the 1.9 percent rise predicted by analysts. The company expected its monthly performance to be softer than March given the earlier Easter and a shift in a cosmetics event to March from April. The company also said that April was hurt by Mother's Day being later in May than it was a year ago.