Wal-Mart's soft sales confirm broad retail trend

|By:, SA News Editor

The warning signs have been out for a few weeks, but Wal-Mart's (WMT) Q2 report confirms that consumers in the U.S. have been pulling back.

Though the excuses from companies vary - weather, auto purchases, payroll tax hike - the trend toward softer discretionary spending on lower traffic remains consistent.

Sector alert: In addition to missing analyst estimates, Wal-Mart also showed a jump in inventory levels in Q2 and warned on emerging markets.

On watch: Costco (COST), PriceSmart (PSMT), Target (TGT)

Related ETFs: XRT, RTH, PMR, RETL.