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Updated from 2:22 p.m. EDT

Retail sales rose modestly in May for many of the nation's largest store chains, but overall growth was slower than expected as American shopping habits continued to get dented by rising interest rates and higher gasoline prices.

Results from many retailers indicated that warmer weather in most of the country and discounts and promotions for summer-related goods did little to spur consumers' enthusiasm.

Some analysts said weaker-than-expected sales at many retailers are causing them to second guess the overall performance of the retail sector.

"There is a general consensus that consumers are getting less enthusiastic, which is making it quite possible that we'll see some moderation of earnings for some of the retailers in the second half," said Brad McGill, research analyst at

Banc of America Securities


The slower sales growth was most apparent for a handful of large department store chains, several of which reported that apparel sales dragged on their overall results. Sales at stores open more than a year, known as same-store sales, were lower at such major retailers as


(DDS) - Get Dillard's, Inc. Class A Report

, where same-store sales fell 3%;

May Department Stores


, where sales dipped 1.4%; and

J.C. Penney

(JCP) - Get J. C. Penney Company, Inc. Report

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, whose department store sales dropped 2.1%. Dillards fell 1/2, or 3.6% to 14 1/2; May fell 7/16, or 1.8%, to 24 1/16; while Penney dropped 9/16, or 3%, to 18 3/16 Thursday.

Federated Department Stores


, owner of




among others, said its same-store sales grew at a paltry 0.5% in May. The results were lower than most analysts had expected, sending shares of Federated tumbling 5 3/16, or 15%, to 29 5/8.

"Apparel sales continued to weaken," said Kelly Whitman, economist at the

Dismal Scientist

, an Internet economics site. "At the same time, consumer electronics and furniture chain stores posted robust sales growth."

That trend helped to offset the weakness in apparel sales at some department stores.

Sears, Roebuck

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reported a 2.3% gain in same-store sales, helped by sales of big-ticket items like appliances, tools, and home-improvement items. That prompted the company to announce that its second-quarter earnings are likely to beat Wall Street estimates. The retailer's shares closed down 1/4, or 1%, to 33 9/16.

Neiman Marcus Group

, owner of high-end department stores

Neiman Marcus


Bergdorf Goodman

, posted a stunning 17.3% gain in same-store sales.

Some chain stores that specialize in apparel

fared even worse , such as


(GPS) - Get Gap, Inc. Report


Ross Stores

(ROST) - Get Ross Stores, Inc. Report

, which both issued second-quarter earnings warnings amid declining June same-store sales.

Gap, which saw sales fall 2% in June, said it now expects to report second-quarter earnings of 23 cents a share, 3 cents below the consensus estimate reported by

First Call/Thomson Financial

. Despite the warning, shares of Gap traded higher Thursday, closing up 3 1/2, or 11.7%, at 33 3/8.

Same-store sales at Ross fell 1%, prompting the company to warn that second-quarter earnings would come in below 44 cents a share, lower than analysts consensus forecast of 49 cents a share.

Results for large general merchandise discount stores were slightly more positive than department stores and clothing retailers, but several chains fell short of their plans for the month.


(TGT) - Get Target Corporation Report

, the nation's fourth-largest retailer, said its same-store sales rose a slower-than-expected 1.1% in June. Meanwhile,



said its same-store sales dropped 8.9% in June, citing rainy weather in the Northeast and increasing competition in the general merchandise arena. Target closed lower by 1 1/4, or 2.2%, at 56 7/16 while Bradlees dropped 7/16, or 8%, closing at 5 1/16.



also said its sales dropped 1% in June, as weak demand for apparel and other seasonal items offset ongoing strength in sales of prescription drugs, consumables, home decor, and sporting goods. Kmart slipped 1/16, or 1%, and closed at 6 11/16 after reaching a 52-week low of 6 9/16.

The nation's No. 1 retailer,


(WMT) - Get Walmart Inc. Report

, reported solid results, saying same-store sales rose 4.8%, matching its own plan. Other general merchandise retailers reporting strong results included

Ames Department Stores


, which posted a 1.3% gain in same-store sales;


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, with a 9.7% increase; and



, whose same-store sales rose 10.7%. Wal-Mart shares were up 3/16 to 57 3/16; Ames shares were up 1/64 to 7 37/64; Rite-Aid climbed 7/16, or 6%, to 7 5/16; while Walgreen climbed 1 5/8, or 5%, closing at 31 5/8.