Retail sales were only unchanged on the month in May, matching their unrevised April outturn and meaning that volumes have still not risen since January. The disappointingly weak performance put annual growth at minus 2.9 percent, also in line with its downwardly revised April print.

Softness in mid-quarter was driven by food, drink and tobacco where demand contracted a monthly 0.5 percent, its fourth straight drop. Non-food sales, excluding auto food edged up 0.1 percent after a 0.3 percent increase in April while auto fuel purchases dipped 0.3 percent.

Regionally, France (minus 0.7 percent) also posted a fourth successive decline but both Germany (0.4 percent) and Spain (0.2 percent) recorded modest gains. Elsewhere it was the usual mixed picture.

Today's update does nothing to improve a decidedly weak picture of Eurozone retail sales. Average purchases in April/May were 0.3 percent below their first quarter mean and, revisions aside, June will need a monthly rise of at least 1.0 percent just to secure a neutral contribution to quarterly GDP growth. The May data leave the region's ECDI (minus 39) and the ECDI-P (minus 43) deep in negative surprise territory showing that economic activity in general continues to fall well short of market expectations.

Retail sales volumes in May are expected to rise 0.2 percent on the month versus no change in April. Monthly volumes have risen only once since last November.

Retail sales measure goods that are sold to the consumer or end-user, generally in small quantities and in the state in which they were purchased by the retailer. Eurozone retail sales are reported monthly, in volume terms and exclude autos and motorcycles. A limited sector breakdown is presented in the first release but much more detail is available in the following period's release.

Retail sales are important indicators of domestic consumer demand and are monitored closely by analysts as an important input to GDP. If you know what consumers are up to, you will have a pretty good idea on where the economy is headed. Needless to say, that's a big advantage for investors. The data are available in both value and volume measures although the press release deals only with volume. In addition to the total, the initial report provides a limited breakdown that separately identifies food, drink and tobacco, and (excluding automotive fuel) non-food products. A more comprehensive dataset is only available with the following month's release. Unlike the U.S. and Canada, auto sales are not included in the retail sales data.

The pattern in consumer spending is often the foremost influence on stock and bond markets. For stocks, strong economic growth translates to healthy corporate profits and higher stock prices. For bonds, the focus is whether economic growth goes overboard and leads to inflation. Ideally, the economy walks that fine line between strong growth and excessive (inflationary) growth.

Retail sales not only give you a sense of the big picture, but also the trends among different types of retailers. Perhaps auto sales are especially strong or apparel sales are showing exceptional weakness. These trends from the retail sales data can help you spot specific investment opportunities, without having to wait for a company's quarterly or annual report.