• by Sarah Mahoney , August 4, 2011

Despite heat waves and unsettling economic headlines, people shopped plenty in July, with many of the nation's largest retailers posting sales increases well within their expectations.

Standouts include Saks, where demand for designer duds, accessories and fine jewelry sparked a 15.8% increase in comparable-store sales. Rival luxury chain Neiman Marcus saw its sales rise 7.7%, and at Nordstrom, results increased 6.6%.

The International Council of Shopping Centers says its index rose 4.6% on a year-over-year basis. "Sales growth continued to show strength in July, which may be a good omen for the back-to-school season," Michael P. Niemira, chief economist and director of research for ICSC, says in its release. "Even with higher prices from gasoline, apparel, and food having inflated the reported sales growth by approximately 2.0 percentage points, July sales performance was still quite solid."

Kantar Retail says its index rose 4.8%, better than the 2.9% gain in July 2010, but still much softer than the 7.1% same-store sales gain in June.

"Many retailers are reporting decent gains in apparel sales, which is a discretionary category that is often the first to suffer from the economic strains on shoppers' confidence and spending intentions," notes Frank Badillo, Kantar Retail senior economist, in its report. "That discretionary spending, however, is undoubtedly falling off most among lower-income shoppers hurt most by rising prices and a weak job market."

One surprise disappointment was Kohl's, where results dropped 4.6%. And at the Gap, sales fell 5%.

Department stores, which spent much of the month gearing up for the critical back-to-school selling season, performed well. At JC Penney, sales advanced 3.3%, also spurred by gains in women's clothing and jewelry. At Macy's, sales rose 5%, and 6.4% for the second quarter.

"Our July sales performance once again exceeded our expectations and represented a continuation of the balanced success we have seen throughout the year. Store and online sales throughout the second quarter continued to be strong at both Macy's and Bloomingdale's," says Terry J. Lundgren, chairman, president and chief executive officer of Macy's, Inc., in its release. "This is especially encouraging given the comparison to our robust same-store sales performance in July and second quarter last year."

At Target, same-store sales climbed 4.1% for the month -- at the high end of its forecast -- and 3.9% for the second quarter, powered by a solid start of back-to-school selling. And at Limited, a 6% sales gain topped its prediction of 4.2%.