Total U.S. sales fall 0.2% in May on plunging auto sales
Washington, D.C. — A report released Tuesday by the Commerce Department showed that total U.S. retail sales fell 0.2% in May, a less-than-forecast dip following April’s 0.3% gain. It was the first drop in 11 months. Excluding autos, retail sales rose 0.3% last month, the smallest gain since July 2010.
“The decline in headline retail sales during May can be chalked up to slumping auto sales," said Alistair Bentley, an economist at TD Economics,” in an Associated Press report. "This was to be expected following the sharp rise in gas prices and the tsunami in Japan, and thus should not be interpreted as a dramatic swing in consumer sentiment.”
Results showed that consumers are overcoming high gas prices and spending in retail stores more than expected.
Economists surveyed by Bloomberg News expected a May drop of 0.5% of total sales.
The report showed sales at food and beverage stores falling 0.5%. Revenue at sporting goods, hobby, book and music stores was down 0.4 %. Sales of electronics and appliances fell 1.3%.
But sales at clothing stores increased 0.2% in May, while sales at building materials and garden equipment suppliers rose 1.2%.
Best Buy Q1 profit falls 12%, results still beat Street
Minneapolis — Best Buy Co. reported Tuesday that net income for the first quarter fell 12% to $136 million, hurt by increased promotions and lower demand for such items as flat-panel televisions and digital cameras. But strong showings in China, mobile phone sales and online performance pushed helped to boost profit and revenue past analyst estimates.
Revenue edged up 1% to $10.9 billion on a 12% jump in online revenue. Same-store sales dipped 1.7%. However, domestic online sales rose 12%, while domestic mobile-phone comparable sales jumped 28%. Tablet computers, digital book readers, appliances and services also saw higher demand.
Best Buy has shored up its profit picture by shifting toward more profitable products such as mobile phones, video games, appliances, e-readers and tablets.
South Africa makes aggressive intervention in Wal-Mart bid
Johannesburg, South Africa — A Tuesday report by Bloomberg said that South Africa’s Economic Development Ministry made an “aggressive intervention” in Wal-Mart Stores’ bid to buy a stake in Massmart Holdings Ltd.
South Africa’s Trade, Economic Development and Agriculture Ministries made a joint bid to the Competition Tribunal to force Wal-Mart to restrict imports if it buys a controlling stake in Johannesburg-based Massmart, concerned about job losses.
That action failed, with the competition authority on June 1 allowing Wal-Mart to proceed with its $2.4 billion purchase on condition no jobs are cut for two years.