From Doug Short: The Census Bureau’s Advance Retail Sales Report for September released this morning showed a welcome improvement over the August decline.
Headline sales came in at 0.6% month-over-month to one decimal, and August was revised upward from -0.3% to -0.2%. Today’s headline number matched the Investing.com. Core sales (ex Autos) came in at 0.5% MoM, which beat the Investing.comconsensus of 0.4%.
Here is the introduction from today’s report:
The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for September, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $459.8 billion, an increase of 0.6 percent (±0.5%) from the previous month, and 2.7 percent (±0.9%) above September 2015. Total sales for the July 2016 through September 2016 period were up 2.4 percent (±0.5%) from the same period a year ago. The July 2016 to August 2016 percent change was revised from down 0.3 percent (±0.5%)* to down 0.2 percent (±0.2%)*.
Retail trade sales were up 0.6 (±0.5%) from August 2016, and up 2.2 percent (±0.7%) from last year. Nonstore retailers were up 10.6 percent (±1.6%) from September 2015, while Food services and drinking places were up 6.1 percent (±3.3%) from last year. [view full report]
The chart below is a log-scale snapshot of retail sales since the early 1990s. The two exponential regressions through the data help us to evaluate the long-term trend of this key economic indicator.
The year-over-year percent change provides another perspective on the historical trend. Here is the headline series.
Here is the year-over-year version of Core Retail Sales.
The next two charts illustrate retail sales “Control” purchases, which is an even more “Core” view of retail sales. This series excludes Motor Vehicles & Parts, Gasoline, Building Materials as well as Food Services & Drinking Places. The popular financial press typically ignores this series, but it a more consistent and reliable reading of the economy.
Here is the same series year-over-year. Note that the current level is fractionally below the highlighted values at the start of the two recessions since the inception of this series in the early 1990s.
For a better sense of the reduced volatility of the “Control” series, here is a YoY overlay with the headline retail sales.
Bottom Line: September sales showed a strong bounce after the August doldrums. Next week we’ll take a close look at Real Retail Sales after the September Consumer Price Index is released.
The SPDR S&P Retail ETF (NYSE:XRT) rose $0.05 (+0.12%) to $43.26 per share in Friday morning trading. Year-to-date, the largest retail-focused ETF with nearly $500 million in assets has gained just 0.12%.
This article is brought to you courtesy of Advisor Perspectives.