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Retailers off to good start
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November 29, 1999: 4:37 p.m. ET
Signs show holiday season could boom, after strong post-Thanksgiving sales
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NEW YORK (CNNfn) - The holiday shopping season appears to be off to a rollicking start this year, with bricks-and-mortar and Internet retailers riding a wave of American consumer confidence.
A number of retailing studies and corporate announcements Monday pointed to a generally upbeat feeling about the industry’s prospects after the first major test of the critical holiday season.
"We’re off to a good start,” said Steve Kernkraut, an analyst at Bear Stearns. "Consumers feel rich, they’re flush with cash and they’re going to spend it.”
The early performance is often a sign whether retailers can hold the line on pricing throughout the entire season. When demand is weaker, for example, merchants are more prone to cut prices or offer other forms of discounts in order to move their goods.
According to check approval service TeleCheck Services, the amount of sales paid for by check on Friday rose by an unexpectedly strong 6.4 percent from the same day a year ago.
But retailers were hesitant to trumpet the solid results. In recent years, Thanksgiving weekend has been responsible for less than 10 percent of total sales during the holiday season as shoppers hold out for bargains at the last minute.
Kernkraut said retailers could face a lull in early December, but said they’ve learned a key lesson: draw in customers by offering coupons early in the season.
Among the top-performing sector players on Wall Street were the Gap (GPS), up 2-7/16 to 41-3/8, and Federated Department Stores (FD), the parent of Macy’s, rose 2-9/16 to 45-1/8. Tandy (TAN), the parent of RadioShack, climbed 3-1/4 to 76-3/8 after announcing "robust” sales over the weekend.
A boon for the virtual world as well
And this is the season that experts predict online shopping will come into its own, racking up sales of $8 billion. Goldman Sachs and PC Data Online, in a weekly report, found online sales rose to $274 million last week, from $66 million in the previous week, led by purchases of software and toys.
While online shopping could enjoy a "breakout” season this year, Kernkraut said, it still makes up only about 1 percent of the nation’s total retail sales.
Toys ‘R Us (TOY) fell 7/16 to 17-15/16 after running into service glitches over the weekend to respond to heavy demand, but upstart rival eToys (ETYS) rose 1-1/2 to 68-1/8.
Shares of Amazon.com (AMZN), the leading online retailer, fell 1-1/2 to 91-5/8 despite saying sales over the weekend jumped 150 percent from the same weekend a year earlier.
Yahoo! (YHOO) said shopping orders jumped five-fold since last year and Lycos (LCOS) reported its best single sales day ever Friday. Yahoo rose 2 to 228-7/8, but Lycos fell 3-7/16 to 60-9/16. 
-- from staff and wire reports
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