NEW YORK – U.S. retailers were on track to post solid — but not spectacular — sales this holiday after a last-minute dash to stores saved Christmas, according to retail indices on Tuesday.
The International Council of Shopping Centers (search) and UBS's weekly chain store retail index found sales rose 2.7 percent in the week to Dec. 25 from the previous week with sales up 4.3 percent on a year ago, its strongest gain since early July.
"Although holiday sales were slow and uneven for most of the season, last-minute shoppers were out in force last week," ICSC Chief Economist Michael Niemira said.
The independent Johnson Redbook retail sales index (search) was up 3.0 percent last week after a 2.1 percent rise the previous week, with cold weather and price cuts boosting apparel sales and good demand for toys, electronics, jewelry and home goods.
But for December overall the index was only up 2.2 percent on a year earlier, missing a target for a 2.6 percent gain.
"The last-minute Christmas rush was not enough to make up for many retailers' sub-par pre-Christmas performance," it said.
Most analysts are expecting modest but slower sales growth than in last year's crucial Thanksgiving-to-Christmas period that makes up about 23 percent of annual retail sales, with higher oil prices crimping lower income earners' budgets.
The National Retail Federation (search) sees sales at stores open at least a year — a key measure known as same-store sales — rising 4.5 percent, to $220 billion, versus 5.1 percent last year, while the ICSC expects sales to rise up to 3.5 percent.
Mastercard's SpendingPulse (search) said sales until Dec. 24 were 8.1 percent higher than a year ago but its data included both online shopping and sales of gift cards, which could total about $15.5 billion and $17.3 billion respectively this year.
Steep growth in online shopping and stronger sales of gift cards — which only count as sales once they are used — have been cited as the highlights of the season alongside robust sales in luxury goods as the economy improves.
Shares in Web retailer Amazon.com Inc. (AMZN) surged 9 percent on Monday after it reported its busiest shopping season in 10 years, and rose another 3.7 percent to $43.81 in morning trading on Tuesday.
But a clearer picture of the shopping season will emerge on Jan. 6 when retailers post their December sales figures.
Wal-Mart Stores Inc. (WMT), the No. 1 U.S. retailer, expects its U.S. same-store sales in December to be in the middle of its forecast range for a 1 percent to 3 percent increase. Last year's sales were up 4.3 percent.
Rival discounter Target Corp. (TGT) said its December same-store sales were in line to rise between 3 percent and 5 percent. Sales at Target stores rose 5.6 percent last year.
Retail analysts at Piper Jaffray said it had been a roller-coaster of a holiday season but tight inventory levels would be the saving grace for many retailers.
UBS retail analyst Linda Kristiansen said the growth in gift cards would hurt December sales with only about 25 percent of these likely to be redeemed this month, but she estimated this could lift January sales by up to 2 percentage points.