UPDATE 2-U.S. retailers hope big Saturday will clinch season

* U.S. stores in last hurrah before Christmas

* Modest turnout despite good shopping weather

* Retail stocks need strong weekend to spur gains

(Updates with California, additional analyst and shopper
comments; new byline)

By James B. Kelleher and Jonathan Lentz

CHICAGO/SECAUCUS, N.J., Dec 18 (BestGrowthStock) – The last
shopping weekend before Christmas kicked off with great
weather, but not the throngs of shoppers retailers and
investors were hoping would clinch a season that has so far
beat expectations.

In New Jersey, Chicago and Los Angeles, the last Saturday
before Christmas — dubbed “Super Saturday” by retailers —
appeared fairly unremarkable: a busy day, to be sure, but not
extraordinarily so.

Ramesh Swamy, a retail analyst with Deloitte, had visited
several malls around Los Angeles and reported feeling
“overserviced” in some.

“When I would walk into one of these stores, I would get a
lot of attention because there weren’t that many folks in
there,” Swamy said. He also said some apparel retailers were
“just clearly desperate” with as many as 100 “75 percent off
signs” in just one section of their stores.

The Saturday before Christmas is typically one of the
busiest shopping days of the year as last-minute shoppers look
to finish off their Christmas list. The 2010 season got off to
a strong start on the day after Thanksgiving — known as “Black
Friday” — and analysts are expecting this to be the best
holiday season for retailers since 2007.

A downpour in Southern California aside, the weather on
Saturday was far better for retailers than last year, when a
blizzard slammed the Northeast, cutting into sales on “Super
Saturday.”

“It’s a super day for shopping,” said Scott Bernhardt, the
chief operating officer of Planalytics. “Ninety-plus percent of
the nation is enjoying very good shopping weather, especially
compared with last year.”

In Secaucus, New Jersey, across the Hudson River from New
York City, the day started off with with uncrowded aisles and
short checkout lines at the local Walmart (WMT.N: ).

The light traffic at Walmart meant Lisa O’Neill, a
41-year-old real estate agent from nearby Nutley, New Jersey,
had no trouble getting what she came for: Christmas card
pictures and a BlackBerry phone she bought as a gift for her
daughter.

O’Neill said she had finished the bulk of her shopping on
the trip, with about 25 percent left with a week to go. “This
year I’m very far behind,” she said. “Otherwise you would not
see me here on a Saturday at Walmart.”

Shopper traffic picked up in the afternoon everywhere, even
Los Angeles, despite the bad weather. But at the Wal-Mart
Stores Inc (WMT.N: ) outlet in Secaucus, store employees said it
was not nearly as busy as Black Friday.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ For full holiday coverage, see: [ID:nUSHOLIDAY] For a graphic on holiday sales: http://r.reuters.com/wen33q) ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

Investors were crossing their fingers and hoping for a big
turnout to help lift retail stocks, which have trailed the
broader market since Black Friday, the traditional
day-after-Thanksgiving kickoff to the holiday season.

The Standard & Poor’s Retailing Index (.RLX: ) is up 2.6
percent since Black Friday, trailing the 4.7 percent increase
of the Standard & Poor’s 500 (.SPX: ) even as industry forecasts
for holiday sales have been on the rise.

The National Retail Federation now expects sales to rise
3.3 percent in November and December, up from its prior view of
2.3 percent. [ID:nN14271743]

Analysts said that a strong holiday season had been priced
in by investors even before Thanksgiving, so it will take a
strong finish to the season to push those stocks higher.

“We need packed malls,” Wall Street Strategies analyst
Brian Sozzi said when asked what would move retail stocks.

Richard Hastings, a consumer strategist at Global Hunter
Strategies, said retail stocks in general can rise another 5
percent in the next month or so if Christmas turns out to be a
bigger bonanza than expected. But they can also slip 3.5
percent if December disappoints.

Consumer spending makes up about 70 percent of the U.S.
economy and this holiday season has been closely watched for
signs that a recovery is gaining traction despite persistently
high unemployment.

With just seven days to go before Christmas, Swamy said
retailers appear to have split into two groups: those keen “to
clear merchandise today” by offering lots of big markdowns and
one-day-only sales and those playing a more controlled, long
game — and trying to extend the season beyond Christmas Day.

The latter, Swamy said, were “holding the line on their
markdowns and looking a little more patient. Some of them were
even advertising early hours and sales on Dec. 26.”

The still sluggish economy has a lot of shoppers, including
Brian Jackson, a 30-year-old construction worker, spending less
this year.

“It’s rough,” Jackson said outside a Toys R Us (TOYS.N: )
store in Secaucus on Saturday afternoon, where he was wrapping
up his Christmas shopping for his three young children.

The Toys R Us store was bustling on Saturday afternoon,
with parents navigating crowded aisles for Paper Jamz guitars
and Toy Story 3 figurines, though checkout lines were short.
(Additional reporting by Brad Dorfman in Chicago, Phil Wahba
and Dhanya Skariachan in New York; Editing by Matthew Lewis and
Eric Walsh)

UPDATE 2-U.S. retailers hope big Saturday will clinch season