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July 7, 2010, 12:10 p.m. EDT · Recommend (1) ·

Heat wave to the rescue

Commentary: Sticky weather drives shoppers to malls in June

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By MarketWatch

NEW YORK (MarketWatch) -- There were a few things working in retailers' favor in June.

The Memorial Day holiday fell in June's fiscal month, meaning some sales from the promotions and stocking up for parties and barbecues were rung up in June.

At the other end of the month, the Independence Day holiday buoyed sales. And don't forget Father's Day in the middle.

Northeast heat wave continues

A record-breaking heat wave is tightening its grip on the U.S. Northeast. Courtesy Reuters.

What seems to have pushed it over the edge were those hot days of late June.

For the week ended July 3, sales rose 3.9% from the year-ago period, and 1% over the prior week, according to data released Wednesday by the International Council of Shopping Centers and Goldman Sachs.

Johnson Redbook Research also showed a sales gain in the final week of June, citing the hot weather, especially along the East Coast. Read The Wall Street Journal coverage of the heat wave.

"This spurred demand for summer merchandise and also drove consumers into air-conditioned malls and outlets to escape the heat which in turn promoted customer traffic for air conditioners, fans, pool and beach equipment as well as warm weather apparel as customers are purchasing according to immediate need," the Johnson Redbook report said.

Most large retailers are expected to report June sales results on Thursday, the ICSC is forecasting a gain of 3% to 4%, which is pretty strong. At the same time, the economy is still fragile and the job picture is pretty dismal, especially for teens, who can usually be counted upon to do a fair amount of summer spending. May results were somewhat shaky, so retailers need June to be a strong performer.

Looking ahead, July isn't usually a great sales month. Retailers are looking to clear out summer merchandise and stock up for fall (tough luck if you happen to need a swimsuit) and will slash prices to move product.

If the blistering heat wave we're suffering through this week in the Northeast has consumers seeking refuge in malls through July, retailers will be celebrating.

-- Angela Moore, Commentary editor

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