(Updates with stock prices in sixth paragraph.)
Dec. 13 (Bloomberg) -- U.S. retail sales rose in November at the slowest pace in five months, indicating faster job growth may be needed to spark the biggest part of the economy.
The 0.2 percent gain in sales followed a 0.6 percent advance in October that was more than initially reported, Commerce Department figures showed today in Washington. Economists projected a 0.6 percent November increase, according to the median forecast in a Bloomberg News survey. Purchases excluding automobiles also rose 0.2 percent.
Retailers like J.C. Penney Co. and Gap Inc. are relying on discounts to drum up sales as the labor market and incomes struggle to strengthen. To maintain spending, consumers have had to draw savings down to the lowest level in four years.
“Sales are growing, but they just aren’t accelerating,” said Ryan Wang, an economist at HSBC Securities USA Inc. in New York. “There have been some real slight hints of improvement in the labor market, but until we get sustained growth in income, spending is going to be moderate.”
Retail sales were projected to pick up after rising a previously reported 0.5 percent in October, according to the Bloomberg survey. The 83 economists’ estimates ranged from advances of 0.2 percent to 1.1 percent.
The Standard & Poor’s 500 Index rose 0.8 percent to 1,246.16 at 9:33 a.m. in New York as global equities rallied after Spain sold more debt than planned at an auction. The yield on the benchmark 10-year Treasury note climbed to 2.06 percent from 2.01 percent late yesterday.
The November gain was the smallest since a similar rise in June. Federal Reserve policy makers meeting today will probably revise their pledge to keep interest rates close to zero through mid-2013, according to economists in a Bloomberg survey.
The Fed will alter the interest rate commitment before June, according to 64 percent of economists surveyed, with 51 percent saying the central bank will abandon the option of a third round of buying bonds, or so-called QE3. Chairman Ben S. Bernanke and his policy-making colleagues will reflect on an economy that has strengthened since their November meeting.
Sales excluding automobiles and service stations increased 0.2 percent, less than the projected gain of 0.4 percent, today’s report showed.
Seven of 13 major categories showed gains last month, led by a 2.1 percent jump at electronics and appliance stores.
Sales rose 0.5 percent at automobile dealers, after a 0.8 percent increase the prior month, today’s report showed. Car and light truck sales in the U.S. advanced in November at a 13.6 million seasonally adjusted annualized rate, the best month since August 2009, according to researcher Autodata Corp.
Purchases excluding autos were projected to rise 0.4 percent, the survey median showed.
Filling-station sales declined 0.1 percent. The retail sales data, which aren’t adjusted for inflation, reflected a drop in gasoline receipts at service stations. Regular fuel at the pump averaged $3.38 a gallon in November, down from $3.43 a month earlier, according to AAA, the nation’s biggest auto group.
Demand at building-material stores decreased 0.3 percent.
Sales excluding autos, gasoline and building materials, which renders the figures used to calculate gross domestic product, climbed 0.2 percent after a 0.6 percent increase in the previous month.
Purchases increased 0.5 percent at clothing stores and 0.3 percent at general merchandise stores.
During the Thanksgiving weekend, spending jumped 9.1 percent per customer from a year earlier to $398.62, according to the National Retail Federation. Sales totaled a record $52.4 billion. For all of November, same-store sales for the more than 20 companies tracked by researcher Retail Metrics Inc. rose a combined 3.2 percent.
“We were positive throughout the month going into Thanksgiving and it only got better from there,” Timothy Johnson, senior vice president of finance at retailer Big Lots Inc., said during a Dec. 2 earnings call. “We feel about as good as we can with the positive performance to begin, but also the acceleration, meaningful acceleration, we saw.”
J.C. Penney and Sears Holdings Corp.’s Kmart chain proclaimed on the front pages of their websites on Dec. 5 that it was Cyber Monday, a week after the actual event occurred. On this Cyber Monday, a term invented by the Washington-based NRF in 2005, deals ranged from 40 percent off a DVD player from Samsung Electronics Co. to 80 percent off a children’s camcorder.
Gap’s Banana Republic chain offered 30 percent off its merchandise in an event dubbed the “It’s not Black Friday” sale. The markdowns followed a greater-than-expected decline in November same-store sales.
An improving labor market could help sustain the gains in consumer spending, which accounts for about 70 percent of the economy. Payrolls climbed by 120,000 workers in November, and the jobless rate fell to 8.6 percent, the lowest since March 2009, from 9 percent, Labor Department figures showed Dec. 2.
Sentiment among consumers has also brightened. The Conference Board’s confidence index surged last month by the most since April 2003. The Thomson Reuters/University of Michigan preliminary index rose in December to a six-month high.
--With assistance from Kristy Scheuble in Washington. Editor: Vince Golle, Christopher Wellisz
To contact the reporter on this story: Alex Kowalski in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Christopher Wellisz at email@example.com