U.S. retailers largely reported October sales declines in a month that saw consumer confidence plunge amid the nation's financial crisis and spreading layoffs.
The sector's weak performance was no surprise, but nonetheless sets the scene for what is looms as a dismal holiday-shopping season.
Numerous retailers reported sharp declines, led by teen retailer Abercrombie & Fitch Co., which saw a 20% drop in sales at stores open at least a year. Upscale retailers like Abercrombie have been feeling the pain more than lower-end stores, which are showing the best overall strength.
From Bloomberg:
October same-store sales fell 0.9 percent, the first drop in seven months, and 4.2 percent excluding Wal-Mart, the International Council of Shopping Centers said. Excluding the effect of the shifting Easter holiday, it's the first decline since at least 2000, Retail Metrics said.
Many retailers anticipated the economic downturn and have done a ``very good job'' of reducing the amount of merchandise on shelves, even as sales decline, Perkins said. Cost-cutting and lower inventory helped retailers including Gap maintain their profit forecasts today.
None of this should be surprising. Over the last few year consumers have seen real estate prices drop. Then over the last 3-4 months they have seen their other source of wealth -- stocks -- plummet as well. Combine that with a deteriorating job picture and you have record low consumer confidence which leads to a consumer led recession.
Below are charts from Prophet.net of various retail sectors. Note that most are trading at or near multi-year lows. Clicking on all the pictures will give you a larger image.
