We saw more evidence this morning that confidence alone is not enough to induce consumers to spend. Last week's surge in consumer confidence led many to believe that the US consumer was making a comeback. However, big misses in May same store sales by Costco and Target this morning cast some doubt on the consumer's willingness to spend.
According to Thomson Reuters estimates, analysts are looking for monthly sales to fall 4.1 percent from last year. However, so far 76 percent of the retailers that have reported same-store sales results have missed estimates so the results may be worse than feared.
If huge gains in consumer confidence and equity values can't get people to spend, this could be a brutal summer for retailers.
Retail Sales Are Falling Short of Estimates [CNBC]