Fears over consumer spending cause Macy’s to cut profit outlook for the year.
US retail sales rose less than expected in October, causing fears that consumer spending could hit economic growth in the fourth quarter.
The Commerce Department reported that retail sales rose 0.1% last month, while economists had forecast a rise of 0.3%.
This follows no change in September.
However, the amount shoppers spent online continued to rise, up 7.1% on October 2014.
Worries over the level of consumer spending caused department store chain Macy’s to cut its profit outlook by 10% – a move which sent its shares tumbling by almost 20%.
Fellow department store chain Nordstrom also cut its full-year forecast, resulting in a similar reaction.
“This is not a great start to the fourth quarter, which is important as we head toward the holiday shopping season,” said Jennifer Lee, senior economist at BMP Capital Markets.
