Consumer Spending in June Stagnates as Consumers Begin to Save More
02 Agosto 2012 - 2:20PM
Marketwired
Luxury retailers, who for the most part have been unaffected by the
economic slowdown, took a hit Tuesday. Coach, the largest luxury
handbag maker in the U.S. reported fiscal fourth-quarter revenue
that fell short of analysts' estimates as a result of shrinking
sales growth in North America. "In North America, however, an
increasingly promotional environment led to lower growth than
expected in factory stores." Coach's CEO Lew Frankfort said in a
statement. The Paragon Report examines investing opportunities in
the Luxury Retail Sector and provides equity research on Nordstrom,
Inc. (NYSE: JWN) and Saks Inc. (NYSE: SKS).
Access to the full company reports can be found at:
www.ParagonReport.com/JWN www.ParagonReport.com/SKS
On Tuesday the Commerce Department released a report showed that
despite an increase in income consumer spending in the U.S.
stagnated in June. According to the report consumer spending was
flat in June after dropping 0.1 percent the month prior. Income and
wages in the U.S. rose 0.5 percent, while the savings rate hit its
highest point in a year, surging to 4.4 percent in June.
"There's been some back-tracking in the labor market so
consumers are choosing to save the income rather than spend it,"
said BNP Paribas' Julia Coronado, chief economist for North
America. "The third quarter will be pretty subdued."
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Nordstrom is one of the nation's leading fashion specialty
retailers. The company is scheduled to release its second quarter
financial results and 2012 outlook after the close of the financial
markets on Thursday, August 9, 2012. Nordstrom reported an 8.1
percent increase in same-store sales for the five-week period ended
June 30, 2012 compared with the five-week period ended July 2,
2011.
Retailer Saks Inc. reported that owned sales totaled $274.0
million for the five weeks ended June 30, 2012 compared to $258.6
million for the five weeks ended July 2, 2011, a 6.0% increase.
Comparable store sales increased 6.0% for the month.
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