Wal-Mart CEO pessimistic amid disappointing US retail stats

15 April 2009 16:54  [Source: ICIS news]

Wal-Mart CEO is pessimisticHOUSTON (ICIS news)--The chief executive of US Wal-Mart, the world’s largest retailer, said on Wednesday that he did not expect a near-term economic recovery after another batch of disappointing retail indicators.

“There is still a lot of stress,” CEO Mike Duke said on NBC’s Today show. “It’s not a ‘V’ recession, where we’re just going to bounce out and come back. This is one that is going to take a sustained change in the way that families live.”

March same-store sales for Wal-Mart, a key end market for packaging materials and plastics, increased only 1.4% from year-ago levels, the company said last week. That figure was far under the average 3.2% growth estimate.

Moreover, the consumer price index fell 0.1% in March, according to seasonally adjusted figures released by the US Labor Department. The figure fell short of expectations for a 0.1% gain projected by economists surveyed by Bloomberg News.

The 0.1% index decline came on the heels of a 0.4% increase in February.

“A chilly start to spring and a late Easter combined for dreary March sales,” said Rosalind Wells, chief economist for the National Retail Federation (NRF). “To compensate for the Easter shift, retailers typically look at March and April together to get a better look at how their stores performed.”

The index has declined 0.4% in the 12 months since March 2008, the first yearly decline since 1955.

Duke’s comments came a day after a report showed that overall US retail sales fell 1.1% in March from February levels, due largely to slumping demand in the auto sector, according to the US Commerce Department. Analysts had forecast a 0.3% increase.

The Dow Jones Industrial Average remained relatively flat on the news, falling 1.91 points, or 0.02%, in early Wednesday trading.

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By: Ben DuBose
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