Retail sales suffered record plunge in April

Retail sales plunged 16.4% in April, the Commerce Department said Friday, as the coronavirus shuttered businesses and kept shoppers home. The month-to-month drop is the biggest since record-keeping started in 1992, and follows an 8.3% drop in March.

"April was the month when large parts of the retail economy simply ground to a halt," Neil Saunders, managing director of GlobalData Retail, wrote in a note. 

For a retail sector already reeling from the migration of consumers to online shopping and to app-based delivery services, a back-to-back free-fall in spending poses a grave risk. Department stores like Neiman Marcus and J.Crew have filed for bankruptcy protection. JCPenney could reportedly file for bankruptcy protection as soon as this week.

An April analysis by a group of economists found that a one-month closure could wipe out 31% of non-grocer retailers around the U.S. A four-month closure could force 65% to close.

Clothing and accessories stores showed the biggest drop in April, falling 79% from the month before. Sales at electronics and appliance stores fell 60%, and furniture sales fell 59%. Sales at grocery stores rose 13% from the year before, but weren't enough to offset a massive decline in other retail sectors.

"After stocking up in March, consumers spent much less on food and essentials but increasingly shopped online for the pandemic staples," analysts at Oxford Economics wrote in a report.

Industrial production also dropped in April, according to a separate measure. The 11% month-over-month drop was "sharper than at any point in the index's 101-year history, including the Great Depression, the end of World War 2 and the Global Financial Crisis," Capital Economics said.