CHICAGO (Reuters) - Some U.S. retailers reported sales declines for July that were not as steep as expected, suggesting that more shoppers may be buying discretionary items.

Photo: REUTERS/Fred Prouser

July's results are likely to mark the 11th consecutive month of falling sales at stores open for at least one year, a measure known as same-store sales.

If such sales do fall once final results are tallied, it would mark the longest losing streak since 2000, based on Thomson Reuters data.

Still, the declines in same-store sales reported by some chains late on Wednesday 5 August and early on Thursday 6 August came in well ahead of analysts' expectations.

Rising unemployment, cool weather and a lack of tax-free holidays like those held last year were expected to keep shoppers at home or buying just what they needed, rather than stocking up heavily on back-to-school items.

Lower gasoline prices may have spurred some to spend, but the price decline crimped sales at chains that sell gas, such as Costco Wholesale Corp and BJ's Wholesale Club Inc. Costco's same-store sales fell 7 percent, deeper than the 6.7 percent drop analysts had expected.

Monthly retail sales reports have been less of a barometer of the overall economy since Wal-Mart Stores Inc, the world's largest retailer, stopped disclosing its data earlier this year.

FOCUS ON TEENS

One area of focus this month is teen apparel, as kids get ready to go back to school later this month and in September.

Skate- and snow-boarding inspired retailer Zumiez Inc posted a narrower-than-expected 16.8 percent drop in July sales at stores open for at least a year.

Same-store sales at Zumiez dropped across departments.

The company noted that this year's later Labor Day holiday would mean that schools in several states would start later, which it said would affect August sales.

But that same shift should help September results.

"We continue to believe Zumiez is a growth story and feel that once the economy begins to rebound, there are still sufficient opportunities for growth," Jennifer Black & Associates said in a note to clients.

Goth-inspired clothing retailer Hot Topic Inc posted a slightly smaller-than-expected 8.5 percent drop in July same-store sales.

But its second-quarter net sales fell more than analysts had expected. Hot Topic also cited the effect of the shift in tax-free holidays and the later Labor Day holiday on its results.

Children's Place, which caters to a younger set, said same-store sales fell 4 percent, topping expectations for a 4.8 percent decline. It forecast a slighter narrower second-quarter loss than Wall Street had expected.

Buckle Inc, one of few chains that has continued to post gains in same-store sales amid the downturn, saw such sales rise less than expected. Buckle's same-store sales rose 2.8 percent, while analysts expected a 10 percent jump.

Limited Brands Inc, however, saw same-store sales fall just 7 percent. Analysts had expected a 12.4 percent drop. Limited expects August same-store sales to fall at a high single-digit rate.

The Standard & Poor's Retail Index soared 10 percent in July, outpacing a 7.4 percent rise in the broader S&P 500.

(Reporting by Jessica Wohl and Ben Klayman in Chicago, Aarthi Sivaraman in Seattle and Martinne Geller in New York; Editing by Ted Kerr)