U.S. retail sales jump, other data mixed as growth fears mount

U.S. retail sales rose by the most in four months on a surge in online purchases, offering some comfort for the economic- growth picture amid increasing concern a downturn is coming, though other data Thursday were mixed.

The value of overall retail sales climbed 0.7% in July after a downwardly revised 0.3% increase in the prior month, according to Commerce Department figures. Two regional Federal Reserve indexes for August came in higher than expected, but the central bank's measure of factory output for July declined and jobless claims were higher than estimated last week.

The retail reading topped all estimates in a Bloomberg survey of economists that had called for a 0.3% gain. Sales in the “control group” subset, which some analysts view as a more reliable gauge of underlying consumer demand, rose 1% and also exceeded the most optimistic projection after a 0.7% rise in June. The measure excludes food services, car dealers, building-materials stores and gasoline stations.

The fifth- straight increase in retail sales shows Americans, buoyed by plentiful jobs and wage gains, are still spending — a welcome sign as the trade war with China weighs on the global outlook with threats of new levies on consumer goods. Personal consumption, the biggest part of the economy, was the largest driver of the expansion in the second quarter.

“The numbers are extremely strong and they come on the back of several good months in a row,” Stephen Stanley, chief economist at Amherst Pierpont Securities. “The main driver is the labor market, kicking off very good income gains. It's a consumer that's got plenty of wherewithal to spend.”

Ten of 13 major retail categories increased, led by a 2.8% jump for non-store sellers, which include online shopping. Retail sales in July may have been propped up by Amazon. com Inc.' s 48-hour Prime Day event, which the company said surpassed sales from the previous Black Friday and Cyber Monday combined. The promotion also likely drove shoppers to rivals Walmart Inc. and Target Corp.