Top US retailers posted better-than-expected January sales today as shoppers redeemed gift cards to buy discounted winter gear and early spring fashions in one of the warmest Januarys on record.
Wal-Mart Stores, the world's biggest retailer, posted its biggest monthly sales gain since May 2004, while rival discount retailer Target Corp. and warehouse club operator Costco Wholesale both beat Wall Street expectations.
Gap, the largest specialty apparel chain, was among the biggest surprises with a 1 per cent increase in January sales at stores open at least a year - a key retail measure known as same-store sales.
Overall, analysts expected US retailers to report a 4.1 per cent increase in January same-store sales, according to research firm Retail Metrics.
Unusually warm weather, gift card redemptions from the holiday season, rising consumer confidence and signs of improvement in the job market all contributed to the strong monthly performance, according to Retail Metrics.
January marks the end of the fiscal year for most retailers, and it is traditionally a clearance month to get rid of winter clothes and make room for spring. It typically generates the smallest portion of fourth-quarter sales.
But the month has taken on greater significance lately with the rising popularity of gift cards. Many chain stores rushed spring merchandise into stores in January in the hope of getting shoppers to redeem the cards on full-price goods instead of clearance items.