Wal-Mart escapes November sales slump

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NEW YORK (CNNMoney.com) -- Wal-Mart Stores reported November sales that trounced expectations Thursday as the discounter continues to gain market share from its rivals in a worsening economy.

But the picture wasn't so jolly for many other leading store chains as more Americans retrenched on unnecessary purchases.

"With the exception of Wal-Mart, the situation last month [for retailers] was a little bit worse than expected," said Erin Armendinger, managing director of the Jay H. Baker Retailing Initiative at the Wharton School.

"Even though gas prices are down significantly and personal income is holding steady, people are storing the extra money away instead of spending it on anything other than necessities," she said.

"Consumer psychology is very negative right now," Armendinger said. "People are worried about their future. We've had the Mumbai attacks. The country is officially in a recession. Job cuts are accelerating. This all makes Thanksgiving seem like a lifetime ago."

But in this environment, Wal-Mart (WMT, Fortune 500), the world's largest retailer, still reported a 3.4% increase in its same-store sales, or sales at its stores open at least a year.

That result beat its own forecast for a 1% to 3% sales gain.

Analysts had expected the retailer to log a 2% sales increase for the month, which also included sales on Black Friday, or the day after Thanksgiving, the unofficially start of the holiday shopping season.

During the month, Wal-Mart said the drop in gas prices put more money in the pocket of its mostly paycheck-to-paycheck shoppers. As a result, the company said consumers shopped more frequently at its stores.

The retailer is also benefiting from more higher-income shoppers trading down to its value-priced products.

Additionally, the company said its aggressive holiday discounts also drove "record grocery sales" in November and lifted sales in the home, clothing and electronics categories.

For December, Wal-Mart expects sales to be at the high-end of its forecast for a 1% to 3% gain.

Other chain stores also reported their November same-store sales Thursday. Thomson Reuters, which tracks sales at 35 retailers, said 48% of merchants missed forecasts, 3% met and 48% beat analysts' sales estimates.

The firm said overall sales fell 2.1% last month, slightly better than its original forecast for a 2.4% decline; sales tumbled 7.8% excluding the impact of Wal-Mart.

Still, last month's decline was the weakest same-store sales results registered since Thomson Reuters first started tracking the estimates in 2000.

Among those hardest hit last month - teen clothing chain Abercrombie & Fitch (ANF) posted a stunning 28% plunge in same-store sales, sales at Gap Inc. (GPS, Fortune 500) fell 10% and Limited Brands (LTD, Fortune 500), which owns Victoria's Secret and Bath & Body Works stores, posted a 12% same-store sales drop.

Wal-Mart's rival Target (TGT, Fortune 500) posted a 10.4% sales decline while Macy's sales fell 13.3%.

In the high-end arena, Nordstrom's sales fell 15.9% and Saks sales declined 5.2%.

But besides Wal-Mart, there were a few notable winners. BJ's Wholesale Club posted a 4.1% sales gain. In the teen space, Hot Topic posted a surprise 6.5% same-store sales gain in November. Analysts had expected the retailer to post a slight decline of 0.1%.

And Buckle logged a stellar 15% sales jump last month.