By Mark Pender

NEW YORK (MNI) – MNI’s U.S. retail trade index slipped back two
points in the Sept. 18 period to 60.7, a level still well above 50 to
indicate wide depth of year-on-year strength in the sector, according to
the results of Market News International’s weekly survey.

Readings in the week edged back from recovery highs. Total ex-auto
ex-gas sales are at a year-on-year +3.9% with same-store sales at +2.7%.

The degree of strength is only modest, in contrast to the depth of
strength that the diffusion index is picking up. Those reporting
significant strength in year-on-year sales outnumber those reporting
significant weakness by nine to one.

Motor vehicles look to be a positive for September. The Commerce
Department adjustment is very favorable compared to August which is of
special note given that both months have 25 selling days.

Month-to-month indications on gasoline sales are mixed. Demand
indications are soft as are price indications yet Commerce adjustments
look to make up some of this difference.

The ex-auto ex-gas group right now shows weakness in both clothing
& accessories and in the nonstore group, offset only in part by strength
in food & beverage and health & personal care. Commerce adjustments are,
on net, favorable for this category.

Commentary has been very cautions with guidance continuing to prove
weaker than results. Despite the sample’s strength in August, chains
have not been lifting guidance which in general calls for incremental
year-on-year deceleration to a low single digit positive comparison from
the low to mid single digits.

Traffic appears to be solid yet shoppers are looking for bargains,
using coupons, and are choosing lower priced goods.

Income is steady at moderate a year-on-year +13%. Sample size in
the latest four-week rolling period is 126 chains making up 113,400
separate U.S. retail locations.

Editor’s Note: MNI compiles its retail trade index based on a
weekly sample of company news and data.

** Market News International New York Newsroom: 212-669-6430 **

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