There was little sign of any uptick in retail spending in July, as retailers released yet another disappointing month of same-store sales results.

But while consumers are continuing to keep a tight hold on their purse strings and watch what they spend as worries about job losses and the economy persist, some industry observers are optimistic that a turnaround may be just around the corner.

"Shoppers are not yet ready to spend freely," says Frank Badillo, senior economist at consultancy and research firm Retail Forward. 

"But the results reported by retailers provide some signs that shoppers are easing up on their cutbacks. And that's especially encouraging given the variety of factors weighing on retail sales in July."

Among those offering a glimmer of hope with rising same-store sales were off-price retailers TJX and Ross Stores, department store group Kohl's, and fashion retailer Chico's. And Gap Inc, Macy's and JC Penney all shrugged off falling revenues to lift their earnings estimates.

But steep declines were still the order of the day at Dillard's, Target, Neiman Marcus and Saks.

Even teen apparel chains are struggling to make their mark, with the usual bright spots The Buckle Inc and Aeropostale missing estimates, and falling same-store sales the order of the day at American Eagle Outfitters, Hot Topic, Wet Seal and Abercrombie & Fitch.

Retail Forward calculates same-store sales were still down 4.6% in July, matching last month's 4.7% decline, but down from the 1.8% gain in July 2008.

However its index excludes Wal-Mart, the largest US retailer, which previously buoyed results but no longer reports monthly sales data.

The International Council of Shopping Centers (ICSC), meanwhile, calculated US chain store sales for July 2009 were down 5.0% on a year-over-year same-store basis.

"July chain store sales were in line with our expectations for the industry and were consistent with the recent trends seen in May and June," says Michael P Niemira, ICSC chief economist and director of research.

"July sales were hampered by leaner inventories as retailers looked to clear out merchandise.

"Additionally, many states pushed their back-to-school sales tax holidays into August, as opposed to July of last year. This sales tax holiday calendar shift likely pared about 0.5 percentage points from July's sales growth."

Other factors weighing on July's results included tough comparisons with the year-ago period which was boosted by economic stimulus payments, fewer promotions, a later start to back-to-school shopping and unfavourable weather.

For those retailers who have managed to lift profit forecasts, most of the margin gains are coming from cost and inventory cuts rather than higher sales. The risk, here of course, is that once costs have been stripped to the bone, more traffic in the stores and compelling merchandise on the shelves is the only way to grow again.

All eyes are now focused on the back-to-school selling period, which runs from the end of August to the first week of September.

But worryingly, restrained plans for back-to-school spending mean it's unlikely there will be a significant improvement in retail sales in the coming weeks.

According to Retail Forward's ShopperScape survey, shoppers will continue to focus on discounted items and make fewer purchases.

But the ICSC expects the later back-to-school shopping season and an improving underlying economy will combine to give a small boost August same-store sales, although they will still be down 4.0% year-on-year.