Retail Sales

Retail sales rose in May for the first time in three months, an increase driven by shoppers returning to automobile showrooms seeking bargains. Retail sales rose 0.5%, as forecast, after a 0.2% drop in April, the Commerce Department said. Sales excluding autos also increased 0.5%, led by gasoline as prices jumped last month. A separate report showed that claims for jobless benefits fell last week.

Internet sales by U.S. retailers during the holiday season rose at their slowest pace as consumers grappled with $3-a-gallon gasoline and the worst housing slump in 16 years. Online spending from Nov. 1 through Thursday increased 19% to almost $28 billion, from $24 billion a year earlier, Reston, Va.-based research firm ComScore Inc. said. Sales growth trailed last year's 26%.

U.S. consumers shied away from compact discs and digital video discs last year, and sales of Internet downloads failed to make up the difference. Album sales fell 15% to 500.5 million units, market researcher Nielsen SoundScan reported Thursday. In 2006, total sales fell 4.9%. The figures underscore the industry's failure to combat music piracy with a campaign of lawsuits and threats. Although digital album sales rose 53% to 50 million units, they represented only 10% of the total.

Dianna Dapkins thought the Internet would be the perfect place to find a rare Croatian wine that her local merchants in rural Shelburne, Mass., don't stock. Sure enough, K&L Wine Merchants, an Internet retailer that also has stores in Hollywood and San Francisco, sells the Plenkovic Zlatan Plavac Barrique for $34.99. Dapkins clicked on the wine to buy it but said she was stunned when the website would not let her complete the sale. "It is really frustrating," she said.

Circuit City Stores Inc., the second-largest U.S. consumer-electronics chain, said Monday that December sales fell 8.9% after holiday season discounts failed to attract shoppers. Sales in stores open at least a year declined 11.4%. Total sales dropped to $1.92 billion from $2.10 billion a year earlier, according to the Richmond, Va.-based company. Customers defected after Circuit City fired 10% of its U.S. employees, replacing them with people willing to work for less.

To the dismay of some city leaders, a gun company is marketing a line of high-end pistols named for the LAPD's Special Investigation Section, an elite group of plainclothes detectives with a history of fatally shooting suspects. The guns for the undercover unit were created at the request of the Los Angeles Police Department. Kimber, a Yonkers, N.Y.-based gun maker, is marketing a slightly modified version to the public, touting the weapons as the "hot new SIS pistols" on the company's website.

This week's flood of readings on inflation, retail sales and earnings is just what a data-hungry Wall Street has been anxious for. But it could be a case of the old saying about be careful what you ask for -- because you might actually get it. Evidence that consumers and companies are cash-strapped could mean the economy is on a fast track toward recession or already is in the midst of one.

Shoppers cut back on their spending at the nation's retailers by 0.4% in December, wrapping up the weakest sales year since 2002, according to a gloomy report that fanned fears of a recession. The Commerce Department reported Tuesday that the month-to-month drop in retail sales, which followed a brisk 1% gain in November, was the worst showing since June, when merchant sales declined by 0.8%.

It's a new year filled with old problems for retailers, which are expected to report later this week that sales gains in January were skimpy to nonexistent -- possibly the weakest on record. That could lead some major chains to lower profit forecasts and add fuel to recession predictions. How bad was it? Sales were "near flat," the International Council of Shopping Centers predicted Tuesday.

Consumer spending slowed to a crawl in January, with retail sales at major chains rising just 0.5% in what was by one measure the month's worst performance in nearly 40 years, according to reports released Thursday. Evidence of consumer caution came from both ends of the marketplace. Discounter Wal-Mart Stores Inc. said shoppers held on tight to the gift cards they received over the holidays or used them to buy milk and bread rather than toys or iPods. High-end Saks Inc.