The nation's retailers had a disappointing start to the holiday season, reporting sluggish sales for November as a much hoped-for surge in Thanksgiving weekend business failed to materialize.

As merchants released their first solid results for the season on Thursday, the downbeat reports came from across the sector, including Wal-Mart Stores Inc. (WMT), Limited Brands (LTD), Federated Department Stores Inc. (FD), and Bombay Co (BBA). Even upscale Nordstrom Inc. (JWN), which had enjoyed a sales surge over the past year, had only modest gains.

Among the exceptions were J.C. Penney Co. (JCP) and Sears, Roebuck and Co. (S), which surpassed Wall Street forecasts. Business was boosted by strong sales over the Thanksgiving weekend, as these stores successfully wooed customers with bigger discounts and earlier store openings than a year ago.

But overall, the industry struggled through the month.

"This can't bode well for the holiday season," said Ken Perkins, an analyst at RetailMetrics Inc., a research firm based in Swampscott, Mass.

Consumers, particularly low- and middle-income Americans, have been forced to cut spending on clothing and other non-necessities as gasoline prices and grocery bills rise. They're also nervous about jobs — on Tuesday, the Conference Board reported that doubts about the economy helped push consumer confidence down in November for a fourth consecutive month.

The International Council of Shopping Centers (search)-UBS sales preliminary tally of 66 retailers increased 1.7 percent for November, lower than the reduced forecast of 2.5 percent to 3 percent range.

The tally is based on what the industry calls same-store sales, or sales at stores opened at least a year. They are considered the best indicator of a retailer's performance.

Based on the tepid results, Michael P. Niemira, chief economist at the shopping center group, said he was cutting his forecast for the November-December period to a 2.5 percent to 3 percent gain, from the original 2 percent to 4 percent projection.

Wal-Mart, the world's largest retailer, reported a meager 0.7 percent increase in sales at stores open at least a year, known as same-store sales. These sales are considered the best indicator of a retailer's health.

Wal-Mart's results met Wall Street's forecasts that were reduced earlier this week, after the discounter warned that its business the day after Thanksgiving was disappointing. The retailer acknowledged that its weekend sales suffered because it had not discounted as heavily as its competitors.

Its total sales increased 8.7 percent.

Costco Wholesale Corp. (COST) reported same-store sales rose 5 percent. Analysts surveyed by Thomson First Call expected 5.8 percent gain. Total sales rose 7 percent.

Limited Brands had a 5 percent decline in same-store sales, far worse than the 4.8 percent increase Wall Street expected. Total sales declined 2.9 percent.

Gap Inc. (GPS) posted a same-stores decline of 4 percent, below the 1.4 percent decrease Wall Street forecast. Total sales were unchanged from a year ago.

Federated reported same-store sales fell 1.4 percent, far below the 1.2 percent gain Wall Street forecast. Total sales performance.

"While we were encouraged by sales over the Thanksgiving weekend, it was not enough to offset the weakness in sales that we experienced earlier in the month," he said.

May Department Stores Co. Inc. (MAY) suffered a 7.7 percent decline, far worse than the 1.4 percent decrease that analysts had expected. Total sales were up 10 percent.

Nordstrom had a 3.1 percent gain in same-store sales in November, below the 5 percent forecast. Total sales rose 6.2 percent.

But Sears and Penney had results that pleased Wall Street.

Sears, which has been languishing in a sales slump and is merging with Kmart Holdings Corp., posted a 2.8 percent gain in its domestic business, much better than the 0.3 percent decline Wall Street expected.

Total sales increased 1.9 percent.

"We were pleased with our November sales results, especially our strong start to the holiday shopping season," said Alan J. Lacy, chairman and chief executive officer, in a statement. "Despite sluggishness early in the month, we enjoyed particularly strong customer response to our enhanced promotional event and had record sales the day after Thanksgiving."

Penney had a 12 percent increase in same-store sales for the month, slightly beating Wall Street projections for a 11 percent increase. Total sales increased 9.2 percent.

Pacific Sunwear of California Inc. posted a 2.7 gain in same-store sales, well below the 5 percent Wall Street expected. Total sales were up 13.4 percent.

Bombay, which sells home accessories and furniture, posted a 13 percent drop in same-store sales, worse than the 5.8 percent decline forecast. Total sales fell 7 percent.

"We were not as promotional as we needed to be during this increasingly promotional period, resulting in a decline in traffic and conversion over the weekend," James D. Carreker, chairman and chief executive officer, said in a statement.