NEW YORK – U.S. shopping malls got a little fuller during the first week of September, giving retailers reason to hope a lull in sales in the summer was behind them, two reports showed Tuesday.
U.S. consumers, whose spending accounts for two-thirds of the nation's economic activity, lapped up discounted back-to-school clothes and stationery, helping retailers -- especially department stores -- forget the bleak month of August.
Sales at U.S. chain stores rose 0.6 percent in the first week of September compared with the same period last month, Instinet Research's Redbook report said.
A separate measure of chain store performance, published jointly by the Bank of Tokyo-Mitsubishi and UBS Warburg, showed a milder 0.1 percent sales gain following a 0.5 percent increase one week earlier.
"The numbers are a little better in tone than last week," said Cary Leahy, senior U.S. economist at Deutsche Bank Securities. "But the year-over-year changes still look pretty anemic."
Sales rose a meager 2.3 percent compared to the same week last year, according to BTM, down from a peak of 4.5 percent touched in July.
Chain stores reported their monthly results for August last Thursday, and the picture for department stores was dismal. Sears, Roebuck & Co. , for instance, posted an 11.1 percent decline in sales. Federated Department Stores said its sales fell 5.8 percent on the month.
But as stores slashed prices on back-to-school clothing and accessories to prevent getting stuck with too much inventory on their hands, value-savvy consumers returned to malls.
"September began on a higher note for most retailers following August's below-plan performance," Redbook said. "For department stores, this represented a recovery from the softness of the past few weeks."
Some analysts have argued that weakness in the retail sector has been more than offset by increased spending on cars and homes, which have benefited in recent months from extremely low rates of interest.
"You do seem to have this rotational play where people are too busy buying cars to go to the mall, but the stories about back-to-school spending are pretty disappointing," Leahy said.
The back-to-school season comes come second only to year-end holiday sales in terms of chain stores' yearly sales volume.
The Bank-of-Tokyo Mitsubishi and UBS Warburg's Weekly Chain Store Sales Snapshot is compiled from seven major discount, department and chain stores across the country that report their weekly results.
The Redbook Retail Sales Average, released weekly by Instinet Research, is a sales-weighted average of annual growth in same-store sales at discount, department and chain stores.