Quarterly comparable store sales continue to fall at the two big U.S. department store chains. Fred Katayama reports.
Disappointing sales at two big retailers. Quarterly comparable store sales fell more than expected at Macy's and Kohl's. Those declining sales combined with higher inventory pushed Macy's profit down 39 percent. It backed its earnings guidance for the full year, but that didn't mollify investors. Macy's shares dropped sharply at the open, deepening their 18 percent loss this year. Kohl's shares also falling even though its profit rose sharply and handily beat expectations. Lower costs and leaner stockpiles helped boost profit. Chief market economist Peter Cardillo of First Standard Financial: SOUNDBITE: PETER CARDILLO, CHIEF MARKET ECONOMIST, FIRST STANDARD FINANCIAL, (ENGLISH) SAYING: "One of the sectors of the economy that has been pressured is retail and that's because of the fact that, you know, there's a lot of discounting going on. And until that evaporates, I think, you know, it's a touch and go situation." Department stores are struggling with declining traffic at malls and tough online competition. So they're cutting costs by closing stores and selling or leasing real estate. Nordstrom will report its results after the markets close.