Retail on Three-Month Winning Streak

Retail sales saw a third straight month of gains in March, beating expectations.
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NEW YORK (

TheStreet

) -- Retail sales rose for the third month in a row in March, beating economists' forecasts.

According to the Commerce Department, sales grew 1.6% during the month, the largest increase since November. Analysts predicted a smaller gain of 1.2%.

Sales were boosted by motor vehicles and auto parts, which soared 6.7%. Excluding this segment, sales climbed just 0.6%.

Who's Getting Rich Off Your Spending? (Forbes)

In other sectors, apparel sales increased 2.3%, building materials and garden equipment rose 3.1% and sporting goods, hobby and books advanced 1%.

Electronic retailers proved to be a disappointment, however, with sales falling 1.3%.

One interesting data point is the 0.3% decline in sales at gas stations. Wall Street Strategies analyst Brian Sozzi said this number runs counter to the improving sales trends experienced by wholesalers like

Costco

(COST) - Get Report

and

BJ's Wholesale

(BJ) - Get Report

, which operate gasoline stations at their clubs. The two companies reported same-store sales gains of 10% and 10.6%, respectively, in March.

The gas-station sales decline also conflicts with the rise in gasoline prices across the U.S. Sozzi believes that shoppers, as prices at the pump creep over $3 a gallon, are starting to consolidate trips to discounters and malls.

That should help one-stop shopping outlets like

Target

(TGT) - Get Report

and

Wal-Mart

(WMT) - Get Report

, as well as malls that have big-box retailers attached.

Though March was a month worthy of celebration, experts are wary about April. "There isn't enough evidence of a recovery trajectory that will result in a real improvement in the economy," said Kevin Regan of FTI Consulting.

He called April a "test" month, since retailers must now decide on what they'll do with their inventory levels.

"March could have been a temporary phenomenon," Regan said.

--Reported by Jeanine Poggi in New York.

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