Autos, building supplies lift May sales

May retail sales were lower than expected, but there were some bright spots in the Commerce Department's monthly sales numbers released today.

Higher sales of autos, building materials and gardening supplies in May lifted retail sales to their fourth straight monthly gain of 0.3 percent.

Motor vehicles and parts sales rose 1.1 percent in April, while building supplies and gardening equipment rose 1.4 percent. Sales of furniture and home goods rose 0.5 percent.

However, economists had forecasted a sales gain of 0.5 percent. Excluding motor vehicles and parts, retail sales rose only 0.1 percent in May compared with a 0.4 percent increase in April.

The hardest hit categories were electronics and appliances, food and beverages, health and personal care supplies, clothing, sporting goods and books. Restaurants and bars also reported lower sales.

"The disappointing report is likely to raise questions about consumers' ability to step up spending and spur the economy to faster economic growth the rest of this year," USA Today reported.

Michael Dolega, senior economist at TD Economics, is optimistic about 2014 sales. "We expect the consumer will continue to drive the U.S. economic recovery in the second quarter and beyond supported by a healing labor market consisting of robust payroll gains and an acceleration in wage growth," he told USA Today.

In addition, the seven retailers tracked by Thomson Reuters reported a 4.4 percent increase in May sales, excluding newly opened and closed stores.

And many retailers posting quarterly results in recent weeks reported that their sales picked up in April and continued in May. Discount retailer Dollar General (NYSE:DG) reported an increase in quarterly sales, following pressure earlier this year from severe winter weather and the lackluster economy. And Costco (NASDAQ:COST) reported a 6 percent increase in May sales, excluding gasoline, surpassing analysts' estimates.

For more:
-See this USA Today article

Related stories:
Good weather, promotions spur May sales
U.S. retail sales hit $4.53 trillion in 2013, e-commerce jumps 17 percent
Winter weather cripples retail sales
Holiday retail sales rise 3.8% in line with NRF forecasts
November retail sales beat estimates, jump most in 5 months

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