L Brands Inc. reported sales at stores open at least a year rose 1 percent in September, missing Wall Street estimates of a 2 percent gain. The company had soft business at its Victoria’s Secret chain, where it had to offer deeper promotions than it had expected.
A group of nine retailers were expected to report a 3.1 percent rise in September same-store sales, compared to a 5.5 percent gain last year, according to Thomson Reuters.
Shoppers did spend where they found deals.
Warehouse chain Costco Wholesale Corp reported U.S. same-store sales that beat Wall Street expectation, as consumer sought out its less expensive merchandise and gasoline.
Fred’s Inc, a discount general merchandise chain, reported better-than-expected sales, and Stein Mart Inc , which sells fashions at big discounts compared to department stores, reported a 5 percent increase.
Over the summer, many shoppers shifted spending to items like cars and homes and away from clothes, hurting retailers that have a heavy presence in malls.
J.C. Penney Co Inc, which reported a 4 percent drop in comparable sales for September but is not part of the index, said traffic trends were better at its off-mall stores.
Consumer confidence decreased in September on concerns about the short-term outlook for jobs and whether the slight improvement in the economy could keep its momentum, according to the U.S. Conference Board.
In September, consumers were also worried about the prospect of a partial U.S. government shutdown, which began on Oct. 1.
U.S. business leaders are concerned about the impact that the political deadlock in Washington could have, especially with the holiday season looming. If the U.S. debt ceiling is not raised by an Oct. 15 deadline, the United States could default on some debt.
“If and when there’s a default, we will feel that,” Macy’s Inc Chief Executive Terry Lundgren told journalists at a conference in New York last week.
Rite Aid Corp reported comparable sales of general merchandise fell 0.5 percent, while at Walgreen Co they rose 2.9 percent. Both chains get the bulk of their revenue from drug prescriptions. (Reuters)