blogs.barrons) (marketwatch). The 18 retailers that reported same-store-sales posted an average 6.4% year over year growth, ahead of Wall Street´s expectations for 4.8% growth and the best performance since June.
Gap (finance.yahoo) shook off its years-long slide to post a resounding 4% same-store-sales gain, well ahead of expectations for a 1.4% drop, wrote Barrons.com (blogs.barrons). At the GAP brand Banana Republic sales jumped 12%. At Target (finance.yahoo), same-store sales grew 7%. Discount retailer Costco Wholesale Corp. (finance.yahoo), Victoria’s Secret parent Limited Brands (finance.yahoo) and department store chain Macy’s (finance.yahoo) also beat Wall Street expectations.
This sales gains were somewhat surprising. The rising gasoline prices are sucking a lot of money out of the pockets of the consumers, as they did in 2008, but they didn`t hamper consumer spending yet. It looks like that other factors are overcompensating the negative influence of the oil price screw:
1. The comeback of the job market is fueling the consumer spending because more jobs mean more income. Plus: The falling weekly jobless claims signal that the risk of losing a job is shrinking, which seems also to encourage to spend more money.
2. The stock market rally is lifting the wealth of the average American and is animating the consumers to shop more (positive wealth effect 1).
3. The housing sector is recovering (drivebycuriosity). Home owners spend more for consumer goods because they regard themselves as wealthier (positive wealth effect 2).