Stocks Fall on Weak Retail Sales

123jump.com Staff
14 Apr, 2009
New York City

Retail sales in March declined 1.1% and producer prices also edged lower. Weak sales in all retail segments expect grocery sales dragged the sales in the month. February sales were revised to an increase of 0.3% from a decline of 0.1% and January sales were revised higher to 1.9% from 1.8%.

[R]10:00AM New York – Retail sales in March declined 1.1% and producer prices also edged lower. Weak sales in all retail segments expect grocery sales dragged the sales in the month.[/R]

Retail sales in March fell 1.1% after rising at 0.3% rate in February. The decline surprised many economists who were looking for gains of 0.2% or better. February sales were revised to an increase of 0.3% from a decline of 0.1% and January sales were revised higher to 1.9% from 1.8%.

The retail sales were dragged by a weakness in most categories of the economy tracked by the Commerce Department from apparel sales, autos and part, appliance and electronics sales and to furniture sales. Only groceries and drug stores sales increased in the month.

Gasoline sales fell 1.6% in March a turn from the rise of 3.1% in February.

Auto and part sales declined 2.3% after falling at a rate of 3% in February. Restaurant sales declined 1.4%, the largest decline in four years.

Producer price index increased 1.2% after falling at a rate of 0.1% in February. The index measured by the Labor Department is likely to remain in check as the domestic consumption falls and weak economies abroad keeps cost of imports lower.

The index excluding food and fuel in the month rose at 0.1% after rising at 0.2% in February.

Federal Reserve has been indicating that though the economy is healthy the prices of goods have a higher likely of a decline and deflation is a greater concern and not inflation.

Fed Chairman Bernanke in prepared remarks to be delivered in Atlanta suggested that recent data in home sales, home building permits and consumer spending suggest that “sharp decline in economic activity is slowing.” He further added that “leveling out of the economic activity is the first step toward recovery.”