Retail Sales Winners Nourished by Food, Electronics: Analyst
The verdict on June retail sales: they could have been worse. Bear Stearns Retail Analyst Christine Augustine joined "Morning Call" to explain why Thursday's lukewarm figures are actually good news -- and to name the factors driving the sector.
"The categories that show strength? Food," Augustine said. "There's a lot of food inflation, and that's what is, in part, driving the strength of that category in warehouse clubs."
Warehouse discounter Costco Wholesale was one of the bigger winners in today's June retail sales reports, posting a 6% rise in same-store sales, in line with predictions of 6.1%. Wal-Mart Stores reported a 2.4% rise in U.S. same-store sales -- topping the analyst consensus of 0.8%.
"But," Augustine pointed out, "like Wal-Mart and Target, the warehouse clubs are also doing well in the general merchandise categories like electronics."
J.C. Penney posted a decline in June same-store sales that was less painful than expected: Same-store sales dropped 1.5% -- but analysts had called for 3.6%. The middle-market store chain said results were boosted by its early jump on back-to-school sales.