U.S. Retail Sales Rose Briskly in October

WASHINGTON�Sales at U.S. retailers soared in recent months, suggesting Americans are spending briskly heading into the holidays and boosting the economy.

Retail sales�measuring purchases at restaurants, clothiers, online stores and other shops� grew a seasonally adjusted 0.8% in October from a month earlier, the Commerce Department said Tuesday. Sales grew 1% in September, revised figures showed, up from a previously reported 0.6% increase.

Those gains marked the best two-month stretch of sales in at least two years.

Strong car sales accounted for much of the bounce, as well as higher gasoline prices that drove up purchases at the pump. But spending grew across a range of items, including construction materials, groceries and health care products. Excluding car purchases, sales rose 0.8%.

Economists surveyed by The Wall Street Journal expected overall sales to rise 0.6% and sales outside of autos to grow 0.4%.

Sales have picked up more broadly�they rose 4.3% in the past 12 months, the best annual gain in almost two years�due to many factors lifting Americans' confidence and discretionary income. Wages are picking up after years of slow growth, employers continue to hire steadily, gasoline prices remain moderate and the stock market recently hit a record high.

Unseasonably warm weather also likely boosted retail traffic in October.

The latest pickup bolsters expectations of a strong holiday shopping season, the most crucial part of the year for many retailers' profit margins. It also suggests the economy's third-quarter rebound is extending into the year's final months, after a sluggish first half marked by weak business spending and shaky growth abroad.

Tuesday's report showed spending rose in most categories. Spending at gasoline stations climbed 2.2%, reflecting higher fuel prices. Spending at non-store retailers, which includes websites, climbed 1.5%.

Meanwhile, Americans cut spending at furniture stores, department stores and restaurants.

Write to Josh Mitchell at joshua.mitchell@wsj.com and Jeffrey Sparshott at jeffrey.sparshott@wsj.com