U.S. retailers from Macy's to Costco posted much weaker-than-expected sales for November as shoppers focused only on big bargains at the start of the key holiday selling season.

Some, like department store operator Macy's Inc , also forecast quarterly earnings below analysts' estimates.

The Thomson Reuters same-store sales index rose 0.5 percent, compared with Wall Street expectations for a 2.1 percent increase.

Out of 15 retailers that reported by early Thursday, 11 missed analyst estimates, including Costco Wholesale Corp , Children's Place

, Walgreen Co and Hot Topic Inc , according to Thomson Reuters data.

Over the U.S. Thanksgiving weekend, consumers focused mostly on promotional deals and made few impulse purchases as concerns about the economy remained top of mind, analysts and executives said.

Retailers are in fact driving traffic to their stores through very targeted promotions that amount to loss leaders, said analyst Brian Sozzi of Wall Street Strategies Inc.

It looks as if the litany of Black Friday and Cyber Monday surveys did not exactly paint a clear picture of the start to the holiday selling season, Sozzi said of early hopes for a strong Thanksgiving weekend.

Store chains also blamed warm November weather, which kept consumers from buying winter clothes.

Macy's shares fell 2.7 percent in trading before the market opened, while Costco declined 2.8 percent. Teen retailers Aeropostale and Abercrombie & Fitch also saw their shares sink more than 7 percent after disappointing monthly results.

November sales results include the day after Thanksgiving, known as Black Friday, when retailers offer rock-bottom prices to kick off the holiday shopping season.

Early data on weekend shopping from the U.S. Thanksgiving Day on November 26 through Sunday showed only a slight increase in retail sales from the comparable 2008 period, when consumers were hammered by a deepening recession and credit crisis.

As of Black Friday, analysts had forecast a 2.5 percent rise in November sales at stores open one year, according to Thomson Reuters data. But estimates shrank since the weekend, and as of Wednesday, analysts expected a 2.1 percent increase.

That would still be the best showing since April 2008 and compares with a 7.8 percent decline in 2008, the worst drop since Thomson Reuters began tracking data in 2000.

RETAILERS PROTECTING PROFITS?

Even if sales are flat or rise modestly during the holiday season, analysts said retailers should report improved profits because they have cut inventories and pared back costs to avoid the huge discounts they were forced into last year.

For example, Victoria's Secret owner Limited Brand Inc forecast a low-to-mid-single-digit decline in December same-store sales, but said it planned to be less promotional this month.

The company also posted significantly higher November margins, driven by improvements in each main business, Amie Preston, vice president of investor relations at Limited, said in a recorded message.

Retail sales data are closely watched as consumer spending makes up roughly 70 percent of the U.S. economy. But the figures also give an incomplete picture because many of the retailers that are key holiday destinations, including industry leader Wal-Mart Stores Inc , Best Buy Cos Inc and Amazon.com , do not report monthly sales.

Macy's said on Thursday that same-store sales fell a worst-than-expected 6.1 percent during the month. It stood by its forecast calling for quarterly earnings of $1.00 to $1.05 a share, excluding one-time items, but that was still below analysts' expectations.

Abercrombie & Fitch's same-store sales fell 17 percent, far worse than the analysts' average view of a 9.3 percent drop.

Costco said same-store sales rose 6 percent, missing the analysts' average estimate of 8.1 percent. Same-store sales at U.S. locations rose 2 percent.

Children's Place Retail Stores posted a 13 percent drop in comparable sales, including online sales, compared with analysts' expectations of a 1 percent rise.

Customers gravitated toward the sale merchandise, a company spokeswoman said in a recorded message.

Walgreen Co, one of the largest retailers that reports monthly same-store sales figures, on Wednesday posted a 3.9 percent rise for November, below analysts' expectations. The drugstore chain also said Thanksgiving weekend was notably softer.

Also on Wednesday, teen clothing retailer Hot Topic Inc posted a worse-than-expected 11.7 percent drop.

And Aeropostale sales came in slightly worse than expected, with a 7 percent increase. The company's quarterly earnings forecast also disappointed some investors.

On the positive side, Limited posted a better-than-expected 3 percent increase and home furnishings retailer Pier 1 Imports Inc

cited a strong Thanksgiving weekend as it reported a 13.7 percent increase in same-store sales for its third quarter ended November 28.

(Reporting by Brad Dorfman; Editing by Lisa Von Ahn)

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