Retail sales in May had their best month since January, as warmer weather and a stock market rally drew out shoppers who had spent March and April cooped up indoors.
Same-store sales across the board rose an estimated 3.9%, slightly beating expectations for a 3.7% boost, according to a measure from Thomson Reuters. In an attempt to tamp down volatility, the data only factors in revenue at locations that have been open at least a year.
The gauge outperformed April’s 2.2% upswing as well as the 0.5% increase from May 2012. Stripping out the effects of drug stores, last month’s retail sales were up 4.6%.
[Updated 2:45 p.m., June 6: Factoring in Gap Inc.'s 7% same-store sales increase, which the retailer announced after the market closed Thursday, total retail sales rose 4.8%, according to Thomson Reuters. Without drug stores, the gauge was up 5.6%.]
For much of the country, May was the first period of the year that truly felt like spring. Bitter temperatures earlier in the year had delayed seasonal spending on lighter clothes and home improvement products.
But consumers last month were also cheered by what analyst Ken Perkins called a “modestly better economic backdrop.”
The stock market initially surged. Home prices appear to be on an upswing. Consumer confidence reached pre-recession levels, according to the University of Michigan.
Some worrisome trends, however, kept retail sales from booming.
Gas prices increased last month in the first rise since February, frustrating many motorists at the start of the summer traveling season.
Private-sector job growth ticked up slightly in May, adding 135,000 positions but still falling far short of expectations, according to payroll processing firm ADP this week. On Thursday, however, the Labor Department said that first-time jobless claims dipped to 346,000 last week, a promising direction.
Still, consumers loosened their retail spending, said Perkins, who calculates a separate retail sales roundup via Retail Metrics Inc. By his count, sales increased 3.5% last month.
American Apparel led the pack with a 10% swell. Costco enjoyed a 5% upturn.
L Brands, however, slightly missed analyst predictions with a 3% expansion, compared to 6% growth a year earlier.
The company’s Victoria’s Secret subsidiary turned in a 4% same-store sales lift, driven by strength in its PINK collection and interest in its beauty offerings for Mother’s Day, according to RBC Capital Markets analyst Howard Tubin.
The overall teen category also lagged 2012 numbers, reporting a 3% increase compared to last year’s 5.3% rise, according to Thomson Reuters.
Wall Street expects a 3.7% swell from Gap, which will release its data after the market closes.
Lately, though, more analysts are waiting for the Commerce Department’s report on retail sales to get a fuller sense of the industry’s health. The government’s next report comes out on June 13.
Private sales summaries, which once featured revenue figures from dozens of major retailers such as Wal-Mart Stores Inc. and Target Corp., have lost much of their sweeping scale this year.
Those companies and others have steadily stopped announcing monthly numbers, choosing instead to report quarterly data. In May, only 11 chains offered up same store sales statistics.