U.S. Retail Sales Defy Forecasts and Drop in June

by Christopher Freeburn | July 16, 2012 1:58 pm

U.S. consumers pulled back from spending[1] last month as fears over the troubled job market grew.

The Commerce Department said on Monday that retail sales in June dropped 0.5%, the third consecutive monthly decline, disappointing economists who had expected a rise in retail sales, Reuters noted.

Economists had anticpated a retail sales increase of 0.2% for June, which would have reversed a 0.2% decline in May.

Consumer spending at department stores fell 0.7% in June, while furniture retailers saw sales contract 0.8%.

The Commerce Department data prompted negative revisions in projected economic growth from analysts at Wall Street firms including Credit Suisse (NYSE:CS[2]), Morgan Stanley (NYSE:MS[3]) and Goldman Sachs (NYSE:GS[4]).

Credit Suisse cut is estimate for U.S. second-quarter growth from 2% to 1.6%.

Retail stocks also fell the sting of June’s unexpectedly-poor numbers. Shares of Target (NYSE:TGT[5]), Wal-Mart (NYSE:WMT[6]) and Kohl’s (NYSE:KSS[7]) slipped fractionally in Monday afternoon trading, while shares of discount retailer J.C. Penney (NYSE:JCP[8]) fell almost 2%. Shares of Macy‘s (NYSE:M[9]), on the other hand, rose slightly.

Endnotes:
  1. pulled back from spending: http://www.bloomberg.com/news/2012-07-16/retail-purchases-in-u-s-unexpectedly-decreased-0-5-in-june.html
  2. CS: http://studio-5.financialcontent.com/investplace/quote?Symbol=CS
  3. MS: http://studio-5.financialcontent.com/investplace/quote?Symbol=MS
  4. GS: http://studio-5.financialcontent.com/investplace/quote?Symbol=GS
  5. TGT: http://studio-5.financialcontent.com/investplace/quote?Symbol=TGT
  6. WMT: http://studio-5.financialcontent.com/investplace/quote?Symbol=WMT
  7. KSS: http://studio-5.financialcontent.com/investplace/quote?Symbol=KSS
  8. JCP: http://studio-5.financialcontent.com/investplace/quote?Symbol=JCP
  9. M: http://studio-5.financialcontent.com/investplace/quote?Symbol=M

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