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15:46 June 7th, 2007

Teen Retail Warms With the Weather; But a Cool Forecast Looms

Posted by: Justin Grant
Tags: Uncategorized

Teen retailers posted better same-store sales numbers this week, but gas prices and a cool housing market spell less-than-spectacular growth for the sector, analysts told Reuters.  

“May should dispel any doubts people had that the consumer is not spending as robustly as they did last year,” Brean Murray Carret & Co. analyst Eric Beder said in an interview.

“All these negatives hitting the consumer at once, I think, has really made them pull back … Even at the teen sector, people are getting a little worried.

Last week, the U.S. Office of Federal Housing Enterprise Oversight said the average rise in U.S. home prices in the first quarter was at it lowest point in a decade. And according to the Federal Energy Information Administration’s most recent nationwide survey, the average price for regular gasoline has climbed to $3.16 a gallon, up 27 cents from a year ago.

Ken Perkins, president of Retail Metrics, said consumers have also been bogged down by a fair amount of debt. He also said shoppers will be less likely to splurge if interest rates rise.

A stellar jobs market helped May sales and should keep the market from bottoming out, Perkins said.

“There are some headwinds, but as long as the job market holds up, comp gains should be modest,” Perkins said.

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