Holiday snapshot shows a gain last week, but down year-over-year

Holiday shoppers returned to stores to hit the after-Christmas clearance sales, and that lifted spending last week compared to the prior week, according to the latest snapshot of seasonal comps released today.

But in total, the holiday season was a bust.

Sales for the week ended Saturday, January 3 were up by 1.4 percent compared to the prior week, according to the weekly chain-store index compiled by the International Council of Shopping Centers and Goldman Sachs.

But comps were down by .8 percent vs. the same week in 2007.

And ICSC repeated its forecast that total retail sales for December will likely fall by 1 percent compared to 2007, after plunging a record 7.7 percent in November.

The prime reasons for the decline: weak demand and deep discounting, ICSC said.

"Bargain shoppers were out in force between Christmas and New Year's taking advantage of retailers' need to clear out seasonal merchandise. As a result weekly sales increased in the final week of the fiscal month," said Michael P. Niemira, ICSC chief economist.

"Though the weekly increase does lend some comfort to how overall sales will fare for December, ICSC Research expects comparable-store sales will decline by approximately one percent for the month," Niemira added.

ICSC and Goldman Sachs also surveyed consumers over the past weekend, and found:
• Half of consumers said they spent less on holiday gifts than in 2007.
• More than 60 percent of shoppers out during the post-holiday period were searching for deep discounts, compared to just under 50 percent in 2007.
• Gift card sales dipped, and continued a two-year decline. Sales were the lowest since 2005.
• Likewise, gift card redemptions were slower in December than last year, though consumers said they would redeem in January at a faster pace than in 2008.

Comps around the globe

It's tough everywhere, though economists in one nation reported a small bright spot. Here's a roundup of global economic updates posted today from Bloomberg News:

• In New Zealand, consumer spending rose 2.6 percent in December. Deep discounting there lifted sales, though the economy is still in recession.
• In the European Union, retail sales fell in December, marking the seventh consecutive monthly decline.
• In England, consumer sentiment declined in December, to its lowest level since 2004, when the survey began.
• In France, retail sales and consumer sentiment dropped in December, reflecting the economic slowdown. The consumer sentiment index fell nearly to a record low reached in July.