Nov. department store sales drop, online sales jump

• Sales of autos, electronics, building suppliers big gainers in November

WASHINGTON (AP) — Americans spent more online in November to the start of the holiday season and began to replace cars and rebuild in the Northeast after Superstorm Sandy.

Retail sales rose 0.3% in November from October, the Commerce Department said Thursday. That offset a 0.3% decline in October from September.

There were troubling signs for the holiday shopping season: Department stores sales dropped 0.8%. And sales at general merchandise stores, a broader category that includes Wal-Mart (WMT) and Target (TGT), fell 0.9%.

But sales that reflect online shopping surged 3% — the biggest gain for that category in 13 months.

Some economists worry that consumers might scale back on holiday shopping if they are concerned about the "fiscal cliff." That's the name for tax hikes and spending cuts that are scheduled to go into effect next year if Congress and President Obama cannot reach a deal to avert them.

Consumer spending actually slowed over the summer from the previous quarter. And many economists worry that consumers have remained cautious in the final three months of the year, because of the storm and their fears about higher taxes next year. That should keep growth below an annual rate of 2% in the October-December quarter, they say.

The November figures were much stronger after factoring out gas prices, which have fallen sharply in recent months. When excluding gas station sales, retail sales increased a solid 0.8%. And gas prices are expected to keep falling through year-end.

The gains were widespread, although much of the strength reflected a rebound from the storm. Auto sales jumped 1.5%, as many people sought to replace damaged vehicles. Sales at home improvement stores increased 1.6%.

The sales figures were affected by the purchases of many Americans shopping for the holidays, most likely taking advantage of promotions during the Thanksgiving Day weekend. Electronic and appliance sales rose 2.5%. Furniture sales increased 1%.

The retail sales report is the government's first look at consumer spending. Consumer spending is important because it drives nearly 70% of economic activity.

The economy grew at a 2.7% annual rate in the July-September quarter. But the gains were mostly because businesses stepped up restocking, which drove more factory production.