Survey: Consumers jittery but not panicky, yet

NEW YORK (CNNMoney.com) -- The deepening credit crunch, subprime mortgage meltdown and triple-digit drops in the stock market are making Americans nervous about their financial situation but not enough to significantly curtail their shopping habits yet, a survey said Tuesday.

The survey of 1,000 consumers, conducted Aug. 16-19 by the International Council of Shopping Centers and UBS Securities, found that 46 percent of those polled said they were aware of the recent market turbulence, though they had not changed their spending habits. This group said they were optimistic the crisis in the credit markets would settle down soon.

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Thirteen percent said they were aware of the market activity and will think twice before making major or non-essential purchases, and another 13 percent said that while they were aware of the situation, the stock market doesn't affect their personal spending.

Another 25 percent said they aren't following the financial situation while the remainder of those polled said they did not know how the credit and mortgage woes might affect them.

Consumer spending is watched closely since it fuels more than two-thirds of the nation's economy.

The credit markets seized up last week, triggering a broad selloff in the stock market and a flight to safe investments like Treasury bonds and shorter-term bills among investors. The Federal Reserve moved to encourage banks to lend last week by cutting the rate it charges banks for loans, but that has failed to end the nervousness in financial markets.

The first signs of problems in the credit markets came in the market for subprime mortgage loans made to consumers with poor credit, who are also core customers for Wal-Mart, Target, Home Depot, Lowe's and some other big retailers. A jump in subprime mortgage delinquencies first roiled the housing market - and is now affecting retailers as well.

Wal-Mart (Charts, Fortune 500), the world's largest retailer and a proxy for the health of the consumer, last week blamed the housing market slump and ongoing turbulence in the mortgage market for hurting sales and profits in the second quarter.

Wal-Mart also warned on its full-year profits, saying that despite steeper-than-normal discounting, its core paycheck-to-paycheck consumers are cutting back. This is worrisome not just for Wal-Mart but for the broader retail industry as merchants prepare for the upcoming fourth-quarter holiday shopping season.

The November-December shopping period can account for half or more of a retailers' annual profits and sales.

For its part, Home Depot (Charts, Fortune 500) also blamed housing market softness and the turmoil in the subprime market for its drop in its second-quarter profits, and warned of more sales pressures in the second-half of the year.

But some retailers are weathering the financial crisis better than others. Home Depot rival Lowe's (Charts, Fortune 500) said Monday it found housing woes eased in some of its key markets while Target Tuesday posted second-quarter earnings and sales that met Wall Street's estimates.

Moreover, Target (Charts, Fortune 500), the No. 2 discounter after Wal-Mart, reported a healthy 4.9 percent increase in the second-quarter at stores open at least a year, a key measure of retail performance known as same-store sales.

That compares with just a 1.9 percent same-store sales increase at Wal-Mart stores last quarter.