(Bloomberg) -- Consumer spending, which makes up 70% of the U.S. economy, is sputtering to a halt -- but not before Americans stocked up on top priorities ranging from baked beans to beer.
“There is incredible strength in consumer packaged goods,” said Stifel brokerage analyst Michael Kobrick, who tracks data from Information Resources Inc. But there’s “declining spending in discretionary items as consumers grapple with the prolonged virus response.”
Some companies, including Walgreens Boots Alliance (NASDAQ:WBA) Inc., say sales are starting to decline after the initial rush. And Visa Inc (NYSE:V). said this week that U.S. cardholder spending fell 4% in March alone.
Mark Vitner, senior economist at Wells Fargo (NYSE:WFC) Securities, said part of that pullback will be temporary: “We should see at least a short, sharp reversal once we move on to whatever the new normal is.”
Meanwhile, here’s what Americans have been snapping up -- and leaving on the shelves.
1. Food
When was the last time instant potatoes were a hot item? As consumers tried to fill up their cabinets at home with food that could last awhile -- with the possibility they would need to quarantine -- big sellers were some decidedly boring staples like powdered milk, baked beans, flour and instant potatoes, according to Stifel.
The surge in food sales is the flip side of diminishing restaurant sales, as thousands of eateries have stopped serving in the face of government orders or health advisories. Consumers stocked up and prepared for lengthy stays before returning to stores.
2. Health Care
Americans are taking much more seriously health care and hygiene, snapping up hand soap, facial tissue and gloves at more than double the rates of a year earlier.
One of the hottest items has been personal thermometers, which have almost quadrupled in sales from a year earlier. Thermometers are giving people a quick indication of whether they have a key symptom of the virus.
3. Working From Home
Working from home, and sheltering in your house or apartment, has resulted in consumers shying away from some products they used for the office.
Sales declined for a variety of cosmetics, fragrances, men’s shaving lotions, socks and shoe polish. And who’s going to the beach? While some spring breakers have violated the social-distancing guidelines in Florida, overall sales of suntan products have plunged.
4. Hoarding Paper
If there’s one thing American consumers will remember from their March shopping, it’s the frantic effort to buy – and, for some, to hoard – paper products, especially toilet tissue. Grocery stores rationed purchases, before shelves went empty. Demand for Charmin, a Procter & Gamble Co. (NYSE:PG) brand, has increased so much, so quickly, that retailers have been put on allocation, which means they receive a fraction of their usual order.
The Stifel data suggest there may be a bit less panic buying now.
5 Beer, Wine
While health officials have maintained that drinking alcohol is not a helpful way to cope with the virus outbreak, Americans are going their own way. Sales of beer, wine, spirits and related products were big gainers as consumers imbibed in their homes rather than at bars or nightclubs. (Cannabis, not tracked here, has been a big beneficiary as well.)
Analysts warn that these trends might not last.
What Bloomberg Analysts Say
“Most U.S. beauty, home- and personal-care categories gained strongly from consumers’ panic-buying in the second half of the four-week period to March 22, IRI data show. More increases are likely, in our view, as the coronavirus-containment effort widens across states and bulk purchases provide a lift.”