Strong kickoff to holiday shopping season

By Parija Kavilanz, senior writer


NEW YORK (CNNMoney.com) -- Retail sales were solidly higher in November, the government reported Tuesday, fueled in part by deep discounting on holiday merchandise.

The sales were so strong that the leading retail industry group boosted its forecast for the holiday season by a full percentage point.

The Commerce Department said total retail sales rose 0.8% last month.

Economists surveyed by Briefing.com on average had forecast an increase of 0.5% for November, compared to a revised 1.7% jump in sales the prior month. October sales were originally reported to have increased 1.2%.

Sales excluding autos and auto parts rose 1.2%, compared to a revised 0.8% gain in ex-auto sales in October. Ex-auto sales were originally reported to have increased 0.4%.

Economists had forecast a rise of 0.6% in the measure for November, according to Briefing.com.

After the report was released, the National Retail Federation bumped up its holiday sales forecast. The trade group now expects combined sales in November and December to increase 3.3% this year, up from its initial forecast for a 2.3% gain.

Holiday sales last year rose an anemic 0.4%

"The start to the holiday season has surpassed all expectations," NRF president Matthew Shay said in a statement.

"While employment data is still a concern, we are starting to see improvement in other economic indicators that support an increase to our forecast," he said. "In order to sustain this momentum for retailers and the U.S. economy, there must be a renewed focus on jobs as we enter the new year."

November's gain marked the fifth straight monthly gain in the measure -- an encouraging sign that, despite a tight job market, consumers are becoming more comfortable with spending on discretionary purchases.

For retailers, November marks the start of the year-end holiday shopping frenzy. Total November-December can account for as much as 50% of merchants' sales and profits for the full year.

Holiday sales this year got off to a robust start. Earlier this month, many large store chains also reported much better-than-expected monthly sales at their stores.

The government report showed sales at clothing stores rose 2.7%, were up 2.3% at sporting goods and hobby stores, increased 2.8% at department stores and climbed 1.3% at general merchandise sellers. Online sales rose 2.1%.

Higher gasoline prices fueled gas station sales to a 4% increase in November.

But there were a few weak pockets as well in last month's report. Electronics sales dipped 0.6%, a figure also reflected when Best Buy (BBY, Fortune 500), the No. 1 electronics seller, reported a miss on its sales and profit last quarter earlier Tuesday.

Furniture purchases slipped 0.5%. To top of page

Just the hot list include
Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Index Last Change % Change
Dow 32,627.97 -234.33 -0.71%
Nasdaq 13,215.24 99.07 0.76%
S&P 500 3,913.10 -2.36 -0.06%
Treasuries 1.73 0.00 0.12%
Data as of 6:29am ET
Company Price Change % Change
Ford Motor Co 8.29 0.05 0.61%
Advanced Micro Devic... 54.59 0.70 1.30%
Cisco Systems Inc 47.49 -2.44 -4.89%
General Electric Co 13.00 -0.16 -1.22%
Kraft Heinz Co 27.84 -2.20 -7.32%
Data as of 2:44pm ET
Sponsors

Sections

Bankrupt toy retailer tells bankruptcy court it is looking at possibly reviving the Toys 'R' Us and Babies 'R' Us brands. More

Land O'Lakes CEO Beth Ford charts her career path, from her first job to becoming the first openly gay CEO at a Fortune 500 company in an interview with CNN's Boss Files. More

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.