Spending tempered in holiday's final stretch

NEW YORK -- On what was supposed to be the biggest shopping weekend of the holiday season, consumers flocked to the nation's stores but remained frugal, despite heavy discounting and advertising blitzes.

The restrained spending in the final stretch before Christmas cast a further pall on the shopping season, already expected to be the worst in at least a decade.

"This is supposed to be the ultimate peak Christmas shopping weekend," said C. Britt Beemer, chairman of America's Research Group, in Charleston, S.C. "I think it was even softer than Thanksgiving weekend."

Instead of the typical surge on the final weekend of the holiday shopping season, traffic and sales were up only slightly from the previous weekend, analysts said, down from the same time a year ago.

Holiday sales and profits for many merchants may end up coming in below already modest expectations, said Jeff Feiner, managing director of Lehman Brothers. That may drag retailers' profits down as much as 5 percent to 10 percent.

"The profit picture looks a lot worse. Traffic was still off for the most important weekend before Christmas, even with the rampant discounts," Feiner said.

Latest blow

This weekend's disappointing turnout is the latest blow to retailers, which suffered sluggish sales since the shopping season began the day after Thanksgiving.

Consumer electronics like game consoles and DVD players were the only bright spots, along with kitchenware and toys like Harry Potter products.

Value-oriented chains, particularly Wal-Mart Stores Inc., fared better than department stores and specialty apparel stores.

The holiday season had five full weekends and was 32 days long, a day longer than 2000. Many shoppers held back, however, because of worries about job security, or lingering concerns about the terrorist attacks.