NEW YORK (Reuters) - Sales at U.S. chain stores fell modestly last week, breaking a three-week run of gains, a report said Tuesday.

Sales fell 0.3 percent in the week ended July 26, the Bank of Tokyo-Mitsubishi and UBS said in a joint report, reversing a 0.3 percent gain the preceding week.

Still, July sales were on track for what was likely to be the strongest monthly sales gain since at least April's 3.1 percent Easter-inflated year-over-year rise, the report said.

The BTM/UBS Weekly Chain Store Sales Snapshot is compiled from a group of major discount, department, and chain stores across the country that report their weekly results.

Separately, Instinet Research said in its weekly Redbook report that sales at chain stores slowed somewhat last week from the brisk pace of previous weeks.

Sales at major U.S. retail stores rose 2.2 percent in the week ended July 26, compared with the same week a year ago, after rising 2.6 percent the previous week, the report said.

Consumer goods such as food and household products showed strength, while many retailers also accelerated promotional selling to pare down excess inventory.