U.S. advance retail sales fell 0.6% in July, according to the U.S. Census Bureau. The decline contrasted with economist forecasts of a 0.1% increase. June retail sales previously grew by 0.2%. The data indicates a significant cooling in consumer spending and raises concerns regarding future economic growth.
Investors reduced expectations for a Federal Reserve interest rate hike in September following the report. Market participants view the cooling sales as evidence that previous rate increases are successfully slowing the economy.
Real estate investment trusts (REITs) and related equities rose on the news. Lower potential borrowing costs provide a tailwind for the rate-sensitive sector. The industry previously faced pressure from the Federal Reserve's cycle of interest rate hikes.