The slowdown was due to a strong June, when sales were up 5.5%, which dropped inventories. Heavy motor-vehicle demand, as well as a downturn in back-to-school purchases due to July's hot weather, also hindered the results.

Department stores fared the worst out of the retail categories monitored by ICSC, inching up by 0.6% as a whole. The luxury segment of the sector, up 4.7%, was well below its year-to-date average of 8.2%. May Department Stores posted the biggest loss, falling 3.3%. On the high end, Neiman Marcus' year-on-year gain was 8.8%.

Wholesale clubs were the strongest sector last month, reporting a 5% jump. Wal-Mart's Sam's Clubs had the best results, climbing 5.1%, while Costco followed closely behind, at 5%.