Business & Markets
U.S. retail sales fall 0.6% in July as major stock indexes ease from records
The broad but uneven slowdown raised questions about consumer momentum without yet establishing a sustained pullback in household spending.
Executive summary
- Retail sales: Advance retail sales fell 0.6% in July, the largest monthly decline since May 2025, after a revised 0.2% gain in June.U.S. Census Bureau — Monthly Retail TradeAssociated Press — retail sales
- The mix: Sales excluding gas stations and auto dealers fell 0.2%, while restaurants, clothing, furniture and building-material merchants posted gains.Associated Press — retail sales
- The market: The S&P 500 and Dow each fell 0.2%, and the Nasdaq lost 0.3%, pulling the major indexes modestly below recent records.Associated Press — market reactionAssociated Press — index closes
- The caveat: The retail report covers goods and restaurants but excludes major services such as travel and hotels, so it is not a complete measure of consumer spending.Associated Press — retail sales
Americans cut spending at retailers by 0.6% in July from the previous month, the largest decline since May 2025 and a sharp miss against forecasts for a small increase. June's gain was revised to 0.2%, leaving the latest report as a notable break after spring spending was helped by tax refunds and major shopping events.U.S. Census Bureau — Monthly Retail TradeAssociated Press — retail salesAxios
The weakness was meaningful but not uniform. Sales excluding gas stations and auto dealers fell 0.2%, while restaurants rose 0.5% and clothing, furniture and building-material sellers also recorded gains. Because the report omits most services, including travel and hotel stays, it offers an early reading on household demand rather than a complete consumer-spending account.Associated Press — retail sales
Stocks edged down after the release. The S&P 500 fell 13.23 points, or 0.2%, to 7,785.76; the Dow Jones Industrial Average lost 107.58 points, or 0.2%, to 53,732.41; and the Nasdaq composite declined 73.86 points, or 0.3%, to 26,729.16.Associated Press — market reactionAssociated Press — index closes
The market reaction reflected two competing interpretations. Weaker demand can reinforce expectations for lower interest rates, which often supports asset prices, but it can also signal slower economic growth at a time when inflation remains elevated. Oil-price swings added another source of uncertainty during Friday's session.Associated Press — market reactionAssociated Press — index closes
One month does not establish a consumer recession. The July decline was concentrated in several categories, the labor market remained broadly balanced, and higher-income households continued to benefit from strong asset prices. The next readings on personal spending, employment and August retail sales will show whether the drop was temporary or the start of a broader slowdown.Associated Press — retail salesAssociated Press — market reaction