Falling gas prices hit retail sales
Sales at gas stations fall 6 percent in October, leading to overall decline in sales, but sales at other retailers post gains.
NEW YORK (CNNMoney.com) -- Retail sales fell in October, according to a government report Tuesday, as consumers again saw savings at the gas pump and put much of those savings into their pockets.
The Census Bureau report showed overall sales fell 0.2 percent in the month, following a revised 0.8 percent decline in September. Economists surveyed by Briefing.com had forecast a 0.4 percent decline in overall sales.
But the decline was primarily due to a 6 percent drop in spending at gas stations compared to September. Excluding spending at gas stations, sales at other types of retailers rose 0.4 percent in the month.
The other closely-watched measure in the report -- sales excluding spending on autos and auto parts, fell 0.4 percent, after a revised 1.2 percent decline in that reading in September. Economists had forecast a 0.3 percent drop in sales excluding autos.
There were some other segments other than gas stations that saw weakness. Spending at furniture and home furnishing retailers fell 0.7 percent, after a 0.2 percent drop in September.
That is a sector that is seen as being hurt by the sharp drop in home sales in recent months, as many home buyers typically make furniture purchases as part of their move. Similarly, building material and garden equipment retailers saw a 0.3 percent decline, although that was an improvement from the 1.8 percent drop in September. The slump in new home construction hurts those sales.
And spending at department stores was also weak, falling 0.7 percent. Many major retailers in that segment had previously reported sluggish sales for October.
Wal-Mart Stores (Charts), the world's No. 1 retailer had reported what it terms "unacceptable" sales in October, as its sales at U.S. stores open at least a year rose only 0.5 percent. The company had gone into the month looking for a 2 to 4 percent rise in that closely watched retail measure known as same store sales. The company managed to beat earnings forecasts for the quarter ending in October though.
Overall same-store sales at major retailers rose only 3.0 percent in October, missing a forecast of a 3.4 percent rise. The gain also was down from the 4.3 percent rise seen in the year-earlier period.
Besides the government's retail report, Tuesday was a busy day for retailer earnings for the quarter ending in October. Home Depot (Charts), the nations' largest home improvement retailer, missed earnings forecast for the just completed quarter, while Target (Charts), the No. 2 general retailer behind Wal-Mart, beat forecasts.
But the government report showed spending at grocery stores increased 1.0 percent, and spending at restaurants and bars gained 0.3 percent.
The report also showed spending on autos and auto parts rose 0.6 percent compared to September, while spending at clothing stores edged up 0.1 percent. Electronic stores saw little change in sales.