The lower-than-expected results did not include Wal-Mart stores, which in recent months has boosted total results but has stopped reporting monthly figures.
Last month's same-store sales had edged up with Wal-Mart, but excluding the world's largest retailer, May was the 10th straight month of same-store sales declines, according to a tally by Goldman Sachs and the International Council of Shopping Centers.
The results come amid faint signs that the gloom of recession is lifting. On Thursday, the Labor Department said the number of Americans on the unemployment rolls fell slightly for the first time in 20 weeks, while the tally of new jobless claims also dipped.
In May, the Conference Board's Consumer Confidence Index rose to its highest level since September. And several retailers including BJ's and TJX Cos. indicated traffic improved in May.
But that generally did not translate to sales, as job worries and falling home prices are still clearly weighing on consumers as they shop.
Results are a "clear indication that the consumer is not stampeding back to the stores, they're still being very careful," said BMO Capital Markets analyst John Morris. "I think the initial panic is over, but now the tough work begins. We're entering a slow summer period when there's not a lot to attract consumers into the stores."
Luxury chains and department-store operators continued to be the weakest sectors, with Saks Inc. and Neiman Marcus reporting double-digit declines. Discounters such as Ross Stores Inc. and teen apparel retailers such as The Buckle Inc. were stronger. Cheap chic discounter Target reported a bigger drop than analysts expected, as apparel and home products continued to be weak sellers.
Overall, necessities like food and health care products continued to be the strongest sellers.
"There's general softness across the board, as consumers continue to face rising unemployment, falling home values and rising gas prices," said Ken Perkins, president of retail consulting firm Retail Metrics LLC.
Gas prices rose 30 cents per gallon in May, with the national average for a gallon of unleaded ending the month at $2.36. Still, prices aren't expected to get near last year's high of about $4 a gallon.
Wal-Mart Stores Inc.'s absence makes conclusions about the broader economy more difficult, said Perkins, because it accounts for 10 percent of retail spending. "Wal-Mart has been lifting everybody for the last year and half," Perkins said.
Also weighing on results was last year's $50 billion fiscal stimulus, which shoppers received in May last year and retailers credited for a lift in sales.
Elsewhere, "the trends we've seen through the first quarter are continuing," said Stifel Nicolaus analyst Richard Jaffe. "The consumer has voted with their pocketbook, they want better value and higher quality at better prices."
Same-store sales, or sales at stores open at least a year, are a key indicator of retailer performance because they measure growth at existing stores rather than newly opened ones. Economists closely monitor consumer spending because it accounts for about 70 percent of U.S. economic activity.
"Consumers are out shopping, but they're looking for value," said Janet Hoffman, managing partner of the global retail practice of Accenture.
Such bargain-hunting benefited some discounters. Off-price retailers TJX Cos. and Ross Stores both reported a same-store sales rise above expectations.
However, Target same-store sales fell 6.1 percent, a bigger drop than the 4.3 percent analysts expected.
Warehouse club operator Costco Wholesale Corp. and rival BJ's Wholesale Corp. both reported same-store sales drops of 7 percent and 6.8 percent, respectively, mostly due to lower year-over-year gas prices.
At both Target and the warehouse clubs, food products were among the most popular items.
Department-store operator Macy's Inc. said same-store sales slipped 9.1 percent, slightly above the 9.3 percent drop Wall Street expected.
The teen sector continued to be among the best performers, with low-price stores doing the best. The Buckle Inc. and Aeropostale Inc. both reported double-digit increases.
However, Abercrombie & Fitch - which has kept prices high despite competitors' markdowns - said same-store sales plummeted 28 percent. Last month, Abercrombie finally bowed to pressure and said it has started to reduce prices.
Analysts generally expect the weak trends to continue throughout the summer. Niemira forecasts a 3 percent to 4 percent drop in June.
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