Brisk back-to-school shopping benefited many retailers in September, with sales at stores open at least a year up more than expected at chains from Kohl's Corp to Nordstrom Inc.
There were signs of both strength and weakness as chains with fresh items enticed shoppers while others were left to question their strategies heading into the critical winter holiday shopping season.
Overall, 23 U.S. retailers posted an average sales gain of 5.1 percent at stores open at least a year, or same-store sales, according to Thomson Reuters. Analysts were anticipating a 4.6 percent rise.
The S&P Retail Index rose 0.7 percent on Thursday morning, outpacing the broader S&P 500 Index.
(Click here for a same-store sales graphic: http://link.reuters.com/muj34s
September sales were positive signals, said Janet Hoffman, managing director of Accenture's retail practice.
The consumer has done a great job of focusing on their savings, reducing their debt and they are back in the market place, shopping. But they are choosing where they are going to spend their money, she said.
Chains catering to teens, young women and families such as Zumiez Inc, Buckle and Limited Brands did much better than expected. Target Corp and Kohl's Corp, each with new exclusive lines, also topped Wall Street's forecasts.
Others in the same categories, such as Wet Seal and JC Penney, fell short of expectations. The largest percentage decline was a 4 percent drop at Gap Inc.
The tally gives a glimpse into consumer spending, as the retailers that issue monthly reports account for a small fraction of overall sales. Wal-Mart, Home Depot, Best Buy, Abercrombie & Fitch and other big chains do not issue monthly sales.
September is a particularly important time for retailers focused on children's and young adult apparel. Back-to-school shopping is the second-largest retail spending season behind the holiday period of November and December.
Early autumn momentum can also indicate how U.S. shoppers will respond to holiday season spending.
By and large, they are shopping for necessities, sticking to their shopping lists and doing a good job of staring down retailers, demanding good prices, said Joel Bines, a managing director of consulting firm AlixPartners.
Sales figures were lifted as chains raised prices to offset higher commodity costs, but traffic slowed, a concern heading into the holidays, he said.
So far, holiday season forecasts have been tepid as the economy takes its toll on consumer sentiment. The National Retail Federation said on Thursday that it expects sales in November and December to rise 2.8 percent, down from a 5.2 percent rise in 2010.
Meanwhile, new claims for U.S. unemployment benefits rose less than expected last week, hinting at an improvement in labor market conditions.
Retailers are doing what they can to appeal to shoppers such as Joanna Polowitz, who said she lost her job a month ago and thinks the economy is getting worse.
I'm definitely holding back, only buying necessities, socks for my son, food because it's reasonable here, Polowitz said at a Walmart in North Bergen, New Jersey, on Wednesday. We're buckling down, not going to dinner as much.
Kohl's said it attracted more shoppers as it launched Jennifer Lopez and Marc Anthony clothing lines.
Target saw a rush for the Missoni line it launched on September 13 that even crashed its recently updated web site. The discount chain said children's clothing was one of its strong categories.
One of the messages is that new launches can drive spending at stores, said Michael Niemira, chief economist of the International Council of Shopping Centers.
Janney analyst David Strasser said that he believes that Target is taking share from a weakened JC Penney.
Target's shares rose nearly 4 percent, while JC Penney shares fell 2 percent.
(Reporting by Jessica Wohl in Chicago, Phil Wahba in New York and Nivedita Bhattacharjee in Bangalore; Editing by Maureen Bavdek)