An unexpected Wal-Mart boost

NEW YORK (CNNMoney.com) -- Wal-Mart Stores said Saturday that its sales for the crucial holiday period will probably grow by 1.6 percent, a stronger than expected result for the nation's leading retailer.

The company originally forecast that sales at stores open for more than a year, an important industry barometer called same-store sales, would grow at most by 1 percent.

Wal-Mart said its final results for the period will come out Jan. 4. The majority of retailers are expected to report their results that day as well.

The Saturday announcement is a needed dose of good news for the retailer and the retail sector at large.

Despite Wal-Mart's early holiday price-cutting, the world's largest retailer failed to generate the sales it sorely needed in November. Wal-Mart (Charts) posted a dismal 0.1 percent dip in same-store sales.

Other retailers seem to have suffered as well. Weather problems affected Gap (Charts). A flat screen TV price war is also expected to have taken a toll on electronics retailers like Circuit City (Charts) and Best Buy (Charts).

The National Retail Federation expects that total holiday sales rose 5 percent this year, slower than last year's 6.1 percent increase.

It's been different on the Internet. Consumers spent 26 percent more online during the 56 days before Dec. 26 in 2006 compared to 2005, according to comScore Networks, a digital research firm. And they set a single-day record of $667 million in online sales on Dec. 11.

And, in what may be a silver lining for traditional retailers, so-called "brick and mortar" retailers appeared to make the most inroads in the online space. (Click here for more on cyber sales).