New York, April 9 (Bloomberg) -- U.S. retailers' sales may have fallen in March because consumers stayed home to watch television coverage of the Iraq war and trimmed spending amid worries about the slowing economy and job losses, analysts said. Sales at stores open at least a year probably were unchanged or declined 1 percent, according to Bank of Tokyo-Mitsubishi Ltd., which tracks results from more than 80 chains. Most retailers will report sales Thursday, when the bank will give its final tally. Merchants such as Federated Department Stores Inc., Best Buy Co. and Wal-Mart Stores Inc. said sales slowed after March 19, when the war in Iraq started. The U.S. lost 108,000 jobs in March, the fourth decline in five months, and the unemployment rate held near an eight-year high, the Labor Department said last week. ``We have a preponderance of negative effects on the March numbers,'' said Mike Niemira, a New York-based economist for Bank of Tokyo. ``Everybody was hurt across the board.''
Several retailers, including Nordstrom Inc. and Borders Group Inc., have lowered first-quarter earnings forecasts because of a sales drop-off following the start of the war. Last month's sales performance contrasts with the 6.4 percent increase in March 2002, the largest monthly rise in almost two years. Same-store sales rose 0.9 percent in February and haven't declined since March 1985, Niemira said. Same-store sales are considered a key measure of a retailer's business because they exclude results from new and closed locations.
`Excuses'
March sales probably were 1 percent to 2 percent lower because Easter falls on April 20 compared with March 31 last year, Bank of Tokyo said. A better measure of retailers' results would be an average of March and April sales, analysts said. Wal-Mart, which has fared better than other retailers, is forecast to have a 2 percent sales rise, Niemira said. That's a sluggish pace for the world's biggest retail chain, he said. Federated, owner of Macy's and Bloomingdale's, is expected to report a 7 percent decline, while J.C. Penney Co., the second- largest U.S. department store chain, is projected to announce a 3.5 percent dip in sales, excluding results at its Eckerd drugstores. Target Corp., the No. 2 U.S. discount chain, may have had a 1 percent decline in same-store sales, Bank of Tokyo said. No. 1 department-store chain Sears, Roebuck & Co.'s March sales may have fallen 11 percent, analysts said. ``There are plenty of excuses,'' including weather and the war in Iraq, said Lynn Yturri, who helps manage $425 million in assets at the One Group Equity Income Fund, part of Banc One Investment Advisors' $100 billion in mutual funds. ``People are going to write this one off.''
Lower Forecasts
Nordstrom, an operator of upscale department stores, last month said first-quarter net income won't meet its original projection of 23 cents to 27 cents a share. Borders, the world's No. 2 book retailer, last week said it expects a loss because consumers' focus on the war hurt sales. Pier 1 Inc., the largest U.S. retailer of imported home furnishings, said it would have its first profit decline in seven quarters and blamed the war's effect on consumer spending. Retailers can ``still capture a good year,'' Yturri said. ``There's pent-up demand growing.'' //www.bloomberg.com