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June Retail Sales: What to Expect

Family Dollar's conservative guidance: is this what Q3 guidance will look like? All the discount retailers are flat to down today as Family Dollar provided guidance for the current quarter (Q4) that is below Street consensus ($0.46 to $0.51 vs. Street estimates of $0.53).

The conference call, mostly with CFO Ken Smith, was very instructive. Smith made it clear that they are having difficulty figuring out the macroecononic picture:

"it's the absence of a trend that we're looking at. And with that, we've taken a very conservative view of the fourth quarter."

Big discounters are down today on the FDO news, but the rest of the retailers are up nicely.

That's because FDO deals in consumables (their clientele is middle-lower income scale), while much of the rest of the big retailers deal in discretionary items. No doubt discretionary categories may also come under pressure, but with a selloff already done (Tiffany ) alone was down nearly 25 percent in two months), traders will want to see a clearer trend before any more selling is done.

Any hope for earnings update on tomorrow's June retail sales report? A few companies historically provide mid-quarter color. Look for something from Aeropostale , Ross Stores , TJX , perhaps even Macy's .

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