Despite a better than expected post-Thanksgiving buying spree [WAMN: 02-Dec-02], US retailers reported disappointing sales for November as a whole.
Wal-Mart said sales at stores open at least a year rose 2.6%, at the low end of expectations, while discount rival Target fell 6.7%. Falls were also reported at Abercrombie & Fitch (-13%) and Sears Roebuck (-10.9%), though there was a surprise 9% leap at long-suffering Gap.
An index of fifty retailers compiled by Thomson First Call registered no change on last year, below forecasts of a 0.6% rise.
Retailers blamed the weak results on the fact that Thanksgiving – traditionally the start of a shopping bonanza – was significantly later in the month this year than last.
Nevertheless, the ability of the US consumer to keep the economy afloat single-handed looks increasingly uncertain, with new research from the Federal Reserve showing that household wealth has fallen to a seven-year low.
Household net worth dropped 4.5% between Q2 and Q3 of this year, the survey found, and the ratio of net worth to disposable personal income (a measure of household wealth) tumbled from 5.2 to 4.9, the lowest since 1995.
Much of consumers’ current spending has been driven by their cashing in on rising home values and low mortgage rates – a situation many economists believe cannot continue.
Data sourced from: multiple sources; additional content by WARC staff