Consumer spending and retail sales ended the second quarter on a soft note, indicating that economic growth and acceleration has weakened, according to the National Retail Federation.
June retail sales, released Monday (July 15) by the U.S. Department of Commerce and U.S. Census Bureau, showed that total retail and food services sales (which include non-general merchandise categories such as automobiles, gasoline stations and restaurants) increased 0.4% seasonally adjusted month-to-month.
Sale rose 5.7% adjusted year-over-year. June sales fell short of the 0.8% consensus estimate.
“Consumers remain wary,” NRF President and CEO Matthew Shay said.
NRF Chief Economist Jack Kleinhenz said while the economy is improving, growth rates and retail sales remain reserved for the foreseeable future. The June retail sales data were the first disappointment (relative to published expectations) in the last three months, but remained in positive territory, notes Budd Bugatch, analyst with Raymond James & Associates.
Bugatch said the softer sales did not keep retail stocks at bay as they outperformed the broader markets modestly in June. The S&P Retail Index (RLX) was flat for the month, while the S&P 500 Index (SPX) decreased 1%.
Other findings from the year-over-year June unadjusted sales report include:
• Building material, garden equipment and supply dealers’ sales rose 6.1%.
• Clothing and apparel accessories stores' sales increased 3.4%.
• Electronics and appliance stores’ sales fell 2.3%
• Furniture and home furnishing stores’ sales increased 1.6%.
• General merchandise stores’ sales increased 0.7%.
• Health and personal care stores’ sales increased 0.7%.
• Online retailers’ sales increased increased 11.5%.
• Sporting goods, hobby, book and music stores’ sales increased 0.2%.