I'm not too sure why this surprised anyone, but overall retail sales were down significantly and retailers are taking it on the chin.  Dismal December sales were reported by almost all retailers, and some of them may have been a surprise.  According to RetailMetrics (research company based out of Swampscott MA) "Overall the holiday season was dismal, consumers are definitely feeling the pain".  Well no kidding.  We're paying $3 plus a gallon for gas, unemployment rates are going up, adjustable mortages are going up, housing prices are declining, heating oil prices are out of control - so what in the world would one expect?

There were a few 'bright spots' - Costco showing an increase in sales of 7%, Walmart up a meager 2.7%, Saks up .8%.  However, the opposing decreases were far in excess of this, with Target down 5%, JC Penny down 7.5%, Macy's down 7.9% and Nordstroms down 4%.  What's interesting is the chains that survived the decreases.  Overall in 2008 the Department Store sector isn't looking particularly strong and close attention should be paid to your portfolio if you are long any of the stocks that comprise this market.

TJX Inc (NYSE: TJX) bucked the sales trend and reported 3% gains in same store sales - along iwth other discount apparel and home goods shops, they said that inventory management and cost control helped them to gross higher profit margins.  According to President of TJX "We achieved these results in a challenging consumer environment and over strong perfomance last year". 

TJX is currently trading at about the middle of their high/low range so I don't necessarily see it as a buy at this point, but at least if this is one of the retail stocks that you're currently invested in it's probably safe to hold onto. 

BJ's Wholesale Club (NYSE: BJ) also seems to have done a fair job in weathering the storm in spite of the significant snowstorms in the northeast during December, they said that food and gasoline sales help them support their results but sales none the less were down about 1% - though they did overall buck the trend. 

BJ's is not far off their low, and perhaps if you're looking to sneak a small amount into this sector it might be something to watch. I would probably take a small long position in BJ's Wholesale, but I wouldn't sink a whole lot into it as I only see sales getting worse. BJ's does cater to those who prefer to buy in bulk and perhaps as consumer confidence continues to decline many will feel that this is a good option for 'stocking up' for lean times ahead.