March 14, 1997|By BLOOMBERG NEWS
The most surprising news in yesterday's retail sales report was the large upward revision for January. Instead of rising 0.6 percent as originally estimated, sales in January actually rose at nearly three times that rate. That made February's gains, which showed strength in all categories, all the more impressive.
Income tax refunds might be fueling some of the growth. The latest Internal Revenue Service statistics show the IRS has processed $2 billion more in refunds this year than at the same time last year. The agency is catching up; at one point, refunds were running $8 billion ahead of 1996, in large part because of increased use of electronic filing by taxpayers.
In addition, the IRS said, the average refund of $1,467 is almost 10 percent higher than last year.
Building materials suppliers, department stores and auto dealers led February's retail increase. Sales of big-ticket goods, including autos, appliances and furniture, rose 1.6 percent during February, the largest increase in a year.
On the stock market, Peco Energy Co. fell 62.5 cents to $20.875, and Unicom Corp. fell 62.5 cents to $21.625. Both are at 52-week lows.
But the retail sales statistics helped retailers. Home Depot Inc. rose 62.5 cents to $57; Lowe's Cos. rose 62.5 cents to $37.625; and Gap Inc. gained 12.5 cents to $35.125.
Woolworth, which will be removed from the Dow industrials on Monday, fell 75 cents to $22.25. It will be replaced with Wal-Mart Stores Inc., up 25 cents to $29.
In other changes to the average, Westinghouse Electric Corp., Texaco Inc. and Bethlehem Steel Corp. will be replaced by financial services company Travelers Group Inc., computer maker Hewlett-Packard Co. and health products company Johnson & Johnson. It was the Dow's first revamping since 1991 and the biggest change since 1959.
Among the other companies replaced in the 100-year-old Dow average, Westinghouse fell 12.5 cents to $18.875. Texaco Inc. fell $1.875 to $100.875, and Bethlehem Steel fell 37.5 cents to $8.375.
Pub Date: 3/14/97
