· Chain store sales rose 2.4% last week. The jump followed a 0.9% gain the prior period and thus recovered all of December's opening week skid of 3.1%, according to the International Council of Shopping Centers (ICSC)-UBS survey. Nevertheless, sales so far in December remained 2.0% below the November average which rose 1.2% from October.

· During the last ten years there has been a 51% correlation between the y/y change in chain store sales and the change in non-auto retail sales less gasoline, as published by the US Census Department. Chain store sales correspond directly with roughly 14% of non-auto retail sales less gasoline.

· The leading indicator of chain store sales from ICSC slipped 0.4% (-1.6% y/y) following two weeks of gain.

· The gains in store sales may be limited by the drain on consumers' budgets from higher gasoline prices, which rose to $2.21 per gallon (21.8% y/y) last week. Some relief may, however, be forthcoming if the last two days' decline in the spot market price for unleaded gasoline hold.

· The ICSC-UBS retail chain-store sales index is constructed using the same-store sales (stores open for one year) reported by 78 stores of seven retailers: Dayton Hudson, Federated, Kmart, May, J.C. Penney, Sears and Wal-Mart.