Bank Of America Internal Data Shows Slow Start To Holiday Season

Bank of America Merrill Lynch released a report Wednesday on Black Friday sales and described the holiday shopping season as having a “weak start.”

Analysts led by Michelle Meyer noted that “BAC internal data showed a sluggish start to the holiday shopping season. Spending on BAC credit and debit cards over Thanksgiving and Black Friday declined 1.6 percent yoy."

“In order to restrict the sample to holiday-related spending, we are measuring “core control” sales, which nets out food services, gasoline, building materials and autos, making it a comparable sample to the Census Bureau’s data. While not as dismal as the 11 percent yoy decline reported by the National Retail Federation (NRF), our data supports the weak anecdotes,” according to the report.

Meyer claimed that “although this is clearly a negative signal, it does not mean the overall holiday shopping season will be a bust.”

The reported noted that in the above chart “NRF data has no correlation (actually an inverse relationship) with overall holiday sales from the Census Bureau. The BAC data historically have a better fit, since it measures actual sales unlike the surveys, but it still has fairly low forecasting power.”

Meyer concluded that “the promotions start earlier each year making the “door buster” deals of Black Friday less appealing. Moreover, the shift toward online shopping provides greater access to sales and incentives, also taking the focus away from Black Friday.

"The bottom line is that while we tempered our optimism, we still look for holiday sales to increase this year given the improving economic backdrop.”