Retail sales dip
Retail sales dropped 1.1% from the previous month in July, according to the Department of Commerce retail report issued August 17. But compared with one year ago – in the early months of the pandemic – sales were up 15.8%. Total sales for the three-month period of April through June were up 31.5% from the same period a year ago.
Auto sales were down 3.9% for the month of July – but up 15.7% from a year earlier. Building material sales were down 1.2% for the month, but up 7.5% from a year earlier; and department store sales were down 0.3% for the month, but up 24.3% from a year earlier. As shoppers return to brick-and-mortar stores, sales for non-store retailers (primarily online) have slipped, down 3.1% for the month, but still up 5.9% from a year earlier.
Restaurants and bars have continued a solid recovery – up 1.7% for the month and 38.4% from a year earlier.
Unemployment rate drops 0.2%
The U.S. economy added 235,000 new jobs in August, sending the unemployment rate down 0.2%, from 5.4% to 5.2%, according to the Employment Situation Report issued September 3 by the Department of Labor (DOL). Average hourly earnings for all employees on private nonfarm payrolls rose by $0.17 to $30.73 in August.
In the week ending August 28, initial unemployment claims dropped to 340,000, which is the lowest level for initial claims since the beginning of the pandemic, March 14, 2020, according to the DOL. The 4-week moving average of 355,000 is also the lowest level since March 14, 2020.
Financials, Communication Services and Utilities lead August returns
The Financial sector of the S&P 500 was up 5.14% in August to lead all sectors, followed by Communications Services, up 5.01%, and Utilities, up 3.98%. Only one sector posted a loss for the month, Energy, which was down 2.04%.
The chart below shows the results of the 11 sectors for the past month and year-to-date: