Top CEOs See Corporate Sales Growth
NEW YORK (
) -- The head honchos of some of the biggest companies in the U.S. expect corporate sales to increase over the next six months.
The Business Roundtable's CEO outlook index, which measures the expectations of 107 chief executives, rose to 44.9 in September from 18.5 in June. A level lower than 50 is consistent with a shrinking economy.
Of those surveyed, 51% expect sales to rise, 23% see no change and 26% say sales will decline.
But just because CEOs see an uptick in spending, that doesn't mean consumers feel the same way. On Tuesday the Conference Board said its
Consumer Confidence index slipped unexpectedly in September
to a reading of 53.1 from 54.5 in August.
September, however, is shaping up to be a more pleasant month, as sales for the week ended Sept. 26 inched up 0.1%, according to the International Council of Shopping Centers and Goldman Sachs. ICSC predicts same-store sales will slip just 2% for the month.
Still, higher sales won't translate into increased spending or the end to hiring freezes, according to the Business Roundtable survey.
"Right now, we're beginning to see sales trending up, but not to the level that translates into meaningful gains in capital spending or jobs," said Ivan Seidenberg, chairman of the Business Roundtable and CEO of
Verizon
(VZ) - Get Report
.
In fact, 40% of the surveyed chieftains actually expect their company's employment to drop in the next six months. Seidenberg doesn't expect hiring to grow for at least another 12 to 18 months, and that's contingent on sales growth.
Only 21% of those surveyed expect a jolt in capital spending, while 44% expect no change and 35% foresee declines.
Retail shares were mostly in the green Tuesday afternoon, despite this mixed data. Drugstores saw some of the biggest gains, with
Walgreen
(WAG)
soaring 10% to $37.67,
CVS Caremark
(CVS) - Get Report
climbing 3% to $35.91 and
Rite Aid
(RAD) - Get Report
up 2.5% to $1.62.
The department-store sector also received a boost, with
Macy's
(M) - Get Report
up 2% to $18.31,
Kohl's
(KSS) - Get Report
growing 2% to $56.07, and
J.C. Penney
(JCP) - Get Report
increasing 3% to $33.90.
Other notable gainers include
Polo Ralph Lauren
(RL) - Get Report
, which spiked 5% to $78.06,
Office Depot
(ODP) - Get Report
, which climbed 3% to $6.61 and
GameStop
(GME) - Get Report
, which inclined 3% to $27.04.
-Reported by Jeanine Poggi in New York.
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