UPDATE 2-Canada May retail sales slide for second month

* Retail sales slide 0.2 pct, ex-autos sales dip 0.1 pct

* Sales decline in 6 of 11 retail sectors
(Adds commentary, market reaction)

OTTAWA, July 22 (BestGrowthStock) – Canadian retail sales
unexpectedly fell in May for the second straight month, led by
a drop in building material and garden equipment supplies.

Total retail sales slid 0.2 percent in May from April,
Statistics Canada said on Thursday. Excluding the auto sector,
sales edged down 0.1 percent, while sales in volume terms rose
0.4 percent, following an upward trend since the start of

The median forecast in a Reuters poll was for a 0.4 percent
advance in retail sales in May. Statscan revised April’s
month-on-month fall to 2.2 percent from an initially reported
2.0 percent decline.

Two of the largest declines in the month were at gasoline
stations, down 2.3 percent, as prices fell at the pump, while
the building material and garden equipment supplies sector fell
4.1 percent.

Given the drop in gasoline prices, some economists were
quick to discount the headline number.

“This is a much better report than the headline suggests
for two reasons,” said Scotia Capital’s Derek Holt and Gorica
Djeric in a note to clients.

“First, the dollar value of retail sales, excluding autos
and gasoline station sales, actually climbed 0.2 percent so it
was gas prices that distorted the headline and the core sales
measure that only subtracts autos.”

They also noted that the decline in the dollar value of
retail sales was all in price terms, as the volume of sales in
fact increased four-tenths of a percentage point in May over

The Canadian dollar (CAD=D4: ) initially softened after the
report. The currency fell to C$1.0467 to the U.S. dollar, or
95.54 U.S. cents, compared with C$1.0413, or 96.03 U.S. cents
immediately before the Statscan release.

Overall, six of 11 sectors posted lower sales.

Of the five sectors that registered gains in May, the
largest increase was a 2.6 percent jump at clothing and
clothing accessories stores.

Stock Market Investing

(Reporting by Ka Yan Ng and Claire Sibonney; Editing by
Theodore d’Afflisio)

UPDATE 2-Canada May retail sales slide for second month