Two US retailers see sales slump

US retailers are facing tough times

Two of America's best-known retailers have given the latest indication that US consumer spending is down sharply.

Department store group Macy's reported a $44m (£29m) net loss for the three months to 1 November, compared with a profit of $33m a year earlier.

Meanwhile, electronics chain Best Buy issued a profit warning, saying sales were down 7.6% in October.

Best Buy said trading conditions were the now the worst the firm had seen in its 42-year history.

Dramatic changes

Macy's third quarter same-store sales - which pull out the impact of new shop openings - were down 6%.

The firm said it would now continue to cut stock levels to help improve margins.

"Since mid-September, rapid, seismic changes in consumer behaviour have created the most difficult climate we've ever seen," said Best Buy chief executive Brad Anderson.

The firm's president, Brian Dunn, added that: "People are making dramatic changes in how much they spend."

Best Buy now expects full-year earnings of $2.30 to $2.90 a share, down from its previous guidance of $3.25 to $3.40.