NEW YORK (CNN/Money) - Back-to-school shopping was the predominant theme in July and helped provide some relief to retailers after a disappointing performance in the previous month but failed to fuel the big results.

With summer not producing the stellar numbers that merchants would have liked to see, industry watchers say they're becoming a little more cautious about their prediction for the second-half of the year, which includes the critical holiday shopping period.

Wal-Mart Stores, the world's largest retailer, reported July sales up 3.2 percent, at the high-end of its 2 to 4 percent growth guidance for the month.

Net sales for the month rose 10.9 percent to $20.6 billion from $18.5 billion a year earlier.

In a pre-recorded sales call, Wal-Mart said food, household paper goods, pet supplies and back-to-school products were among the top-performing categories last month.

Same-store sales at its Sam's Club warehouse store division rose 7.7 percent, while sales at its namesake discount stores rose only 2.4 percent.

However, the discounter once again tempered expectations going forward.

For August, Wal-Mart (WMT: Research, Estimates) sees sales at stores open at least a year to be up in the 2 to 4 percent range but cautioned that August sales would be "negatively impacted" by a shift in the Labor Day holiday by one week, fewer markdowns and fading impact of the child tax care credits which were distributed at this time last year.

Target Corp. (TGT: Research, Estimates), the No. 2 discounter behind Wal-Mart said its sales rose 3.8 percent in July, beating its own guidance of a 1 to 2 percent gain.

July is typically seen as a transitional month marked by heavy clearance activity as merchants cycle out summer merchandise and preview products for fall. Overall, analysts expect July sales to be up 3.2 percent, according to First Call.

Despite many clothing chains displaying their back-to-school inventory earlier than usual this year, teen apparel chains were still a mixed bag.

"July sales were weaker than expected," said Richard Hastings, retail sector analyst with Bernard Sands. "Summer can be a volatile season for retailers but I am a little surprised by the weakness in apparel. I'll be keeping an eye on discretionary spending going forward."

Among the winners, Urban Outfitters (URBN: Research, Estimates) posted sales up a stunning 26 percent and Pacific Sunwear (PSUN: Research, Estimates)'s sales rose 6 percent. However, sales at Abercrombie & Fitch (ANF: Research, Estimates) fell 9 percent.

Sales at Gap (GPS: Research, Estimates) Inc., the No. 1 apparel retailer, fell 5 percent, dragged lower by declines in the Gap, Banana Republic and Old Navy chains.

Limited Brands (LTD: Research, Estimates), parent of Victoria's Secret, Bath & Body Works and Express chains, said its July same-store sales were flat, missing Wall Street expectations for a 2.1 percent gain.

Department stores struggled last month as did home furnishings chain Pier 1 Imports.

Pier 1 Imports (PIR: Research, Estimates) posted a comparable sales decline of 1.3 percent and warned that despite limited national TV and newspaper advertising, customer traffic was inconsistent throughout the month, especially the last two weeks of July. The retailer expects more bad news next month, forecasting a decline in August sales of between 4 to 8 percent.

Additionally, the company warned that second-quarter earnings could be half of what Wall Street had forecast.

Among department store chains, sales at May Department Stores (MAY: Research, Estimates) fell 5 percent. Federated Department Stores, parent of Macy's and Bloomingdales, reported sales up 3.7 percent last month, below Wall Street forecasts for 4.1 percent gain.

Said Hastings, "Two months of weak industry numbers don't bode well for holiday sales," adding that he now expects comparable sales for the November-December sales period to decline between 1.0 to 1.5 percent.