By Phil Wahba
(Reuters) - Retail spending continued to grow modestly in April as bad weather delayed spring shopping in much of the country and frugal consumers gravitated toward discount chains.
Twelve major U.S. retailers reported a 3.7 percent increase in April sales at stores open at least a year, according to Thomson Reuters same-store sales index. That was less than the 4.3 percent increase Wall Street expected.
Wall Street got ahead of itself with upbeat expectations, said AlixPartners' Managing Director Steve Nevill, noting that unemployment remained high and consumers were still worried about their prospects.
"I still don't see us breaking out of this average performance until something big happens to lift consumer confidence," Nevill said.
L Brands Inc
Costco Wholesale Corp
In contrast, so-called off-price chains TJX Cos Inc
Ross raised its first-quarter profit forecast after reporting a 7 percent gain in same-store sales. Larger rival TJX Cos said same-stores sales rose 8 percent last month. TJX Cos shares added 0.6 percent, while Ross was up 0.2 percent.
Because of the timing of Easter, March sales numbers were artificially low, while April got a boost. Taken together, retail spending grew about 2 percent, roughly in line with trends in the last two years, said International Council of Shopping Centers Chief Economist Michael Niemira.
Spending is not expected to rise much faster than that in the coming months as consumers wrestle with a variety of worries, including the U.S. economy, Europe's economic problems, the debt debate in Washington and employment.
The ICSC expects same-store sales to increase 2 percent to 3 percent this month.
The S&P Retail Index <.SPXRT> was up 0.1 percent at midday.
LOTS OF DISCOUNTING
With the weather cool in much of the country in April, many shoppers' delayed purchases of spring clothing.
Janney Capital Markets analyst Adrienne Tennant said in a note this week that retailers were more aggressive in offering discounts in April, but things eased at the end of the month, suggesting stores had not over-ordered and making it likely they would avoid panicked markdowns.
Retailers that don't report monthly sales posted disappointing numbers. Ann Inc
Last week, drugstore chain Rite Aid Corp
Others did manage to buck the trend. Teen retailers The Buckle Inc
As previously announced, TJX and Ross will no longer report monthly sales after April. That will leave 11 U.S. chains reporting monthly sales, down from a peak of 68 in 2006. In the years since, big names such as Macy's Inc
(Additional reporting by Jessica Wohl in Chicago; Editing by Maureen Bavdek and Jeffrey Benkoe)