NEW YORK — Despite a flow of bad economic news that kept consumer confidence shaky, a number of retailers reported July sales on Thursday that beat Wall Street estimates.
The International Council of Shopping Centers' preliminary tally of retailers' sales at stores open at least a year — a key indicator of a merchant's health — was up 4.6 percent, a slower pace than June's 6.9 percent gain but in line with forecasts.
While the numbers signal a strong start to the back-to-school shopping period, which runs roughly from mid-July through September, there are concerns that shoppers will soon return to their habits of the Great Recession by focusing on necessities and waiting for sales.
Considering that the back-to-school season accounts for 16.1 percent of annual retailers' revenues, according to the International Council of Shopping Centers, that could be a big problem for retailers.
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"July looks like it's shaping up to be a solid month despite all the economic headwinds," said Ken Perkins, president of RetailMetrics, a research firm. "But the concern is whether shoppers will buy back-to-school items at full price."
In this environment, retailers that cater to higher-income shoppers have fared the best. The biggest standouts have been luxury retailers like Saks, which had a 15.6 percent increase for the month.
Meanwhile, those catering to the low- and middle-income shoppers have been hurt the most by the economic downturn. Still, many of those retailers posted sales gains during the month.
Target, which has been beefing up its grocery business, said revenue at stores open at least a year rose 4.1 percent in July as shoppers picked up more groceries, and health and beauty products.
Many department stores also had respectable results as they drew shoppers in with exclusive merchandise and sales on select items. J.C. Penney's 3.3 percent beat the 2.3 percent estimate from Wall Street. And Macy's posted a 5 percent gain, which exceeded the 4.1 percent forecast.
The hope among retailers is that the July sales momentum will continue into August, with shoppers picking up a few fall items at full price while buying some summer bargains, too. But surveys from the National Retail Federation, Deloitte LLP and other groups show that customers plan to buy only what the family needs, focus on fat discounts and reuse last year's items.
"It's going to be tough for retailers to succeed because of the economic uncertainty," said Stifel Nicolaus analyst Richard Jaffe.