An upbeat forecast from Wal-Mart ( WMT) bolstered Wall Street's expectations for monthly sales due out from retailers Thursday.

But given the extraordinary events that transpired in September, investors are still braced for disappointments from the chain stores.

Ken Perkins, president of Retail Metrics LLC, said his firm expects its survey of about 100 national retail chains to show an overall same-store sales gain of 3.6%. Same-store sales cover sales at stores that have been open for at least one year and serve as a key measure of a retailer's performance.

Wal-Mart, the world's largest retailer, has said it expects a same-store sales gain of 3.8% for the month, which would hit the high end of its previous forecast, despite the economic damage done by two hurricanes that slammed in to the Gulf Coast. Hurricane Katrina, the first of the two storms, is the costliest natural disaster in U.S. history.

The retailing giant had closed 126 locations due to Hurricane Katrina and 155 because of Hurricane Rita, but by the beginning of October, only 15 stores remained closed.

Meanwhile, the company saw increased sales of canned foods, water, candles, batteries, flashlights and lanterns as consumers prepared for the storms. Afterward it benefited from a pick-up in basic apparel, hardware and cleaning supplies as residents of the storm-ravaged region started their recovery.

Shopper Psychology

Excluding Wal-Mart's results, Perkins said the overall sales gain for September would dip to 3.4%. That comes on a relatively easy comparison to last September's pace of 2.3%.

"The numbers look pretty good, but it's going to be a difficult month to draw any solid conclusions about the retailing environment given all the intangibles that have taken place," Perkins said. "If we do see some disappointments here, I think it could be the harbinger of what might be a difficult holiday shopping season for retailers."

Aside from the psychological effects of the one-two punch dealt to the Gulf Coast by Hurricanes Katrina and Rita, investors are struggling to gauge the effect spiking gas prices will have on consumer spending. Prices had already skyrocketed before the hurricanes, and now there are widespread concerns about a national energy emergency.

As a result, the Conference Board recently said its consumer confidence index recorded its steepest point drop in 15 years in last month, and the University of Michigan said its consumer sentiment index plunged to a 13-year low.

On Wednesday, Wendy's ( WEN) warned that its same-store sales dropped 5% in its recently ended third quarter. The fast-food chain operator blamed the decline on high gas prices, lower consumer spending and store closings along the Gulf Coast.

Those factors will lower its earnings by 2 cents a share in the third quarter while high beef prices will subtract another 2 cents. Analysts are expecting more earnings revisions as retailers come to terms with their September results.

"We expect there will be more commentary regarding earnings guidance than usual given that two-thirds of the quarter's sales will be known and there is rising investor concern over the health of the consumer," said Sanford Bernstein analyst Emme Kozloff in a recent research note. "September is typically the most important month of Q3, representing 37% of sales, and companies have now had a glimpse of the impact to their specific consumer groups from the large increase in energy prices."

Crude Competition

Rising gas prices make it likely the long trend of strength coming from high-end consumers and weakness at the low end will stay in place, since gas prices eat up a larger percentage of discretionary spending for the poor. Analysts will be looking closely at retailers catering to consumers in the middle to see if the strain of gas prices is moving up the income scale.

Costco ( COST) and Target ( TGT) are expected to lead the sector with September same-store sales gains of 6.4% and 4.9%, respectively.

On the downside, weakness will probably continue at Gap ( GPS), with a decline of 7.2%, and Limited ( LTD), with a 2% drop.

Teen-apparel retailers, favorites on Wall Street for logging spectacular comp gains, are showing signs of wear and tear. Perkins said overall estimates for the group have shed about 60 basis points since Monday, as a growing number of analysts have concluded they might be approaching a slowdown.

Still, American Eagle Outfitters ( AEOS) is expected to show a 10.7% comp gain for September, while Abercrombie & Fitch ( ANF) is set for a 16.4% jump.

Though they can ultimately be inflationary, growth in the job market and wage gains can ease pressures on consumer spending. On Friday, the federal government will issue its report on the employment situation. The consensus forecast of economists is that 150,000 jobs came off nonfarm payrolls in September, while average hourly earnings rose 0.2%.

Many investors are prepared to attribute any unusual softness to a temporary setback inflicted by the hurricanes.

"You can write off some weakness, but certainly not all of it," Perkins said. "The economy, surprisingly, has been holding up here, and if the job market stays stable, that could really help consumer confidence for the shopping season." But as winter draws nearer and homeowners in the Midwest and the Northeast start to get their heating bills, there could be some "sticker shock," he said.

"There are no signs that there's going to be any significant abatement in gas prices or home heating oil and natural gas prices," Perkins added. "I think that's going to continue to squeeze middle-income and lower-income consumers."