April 16 (Bloomberg) -- Wal-Mart Stores Inc., the world's largest retailer, said April sales at U.S. stores open at least a year are rising within its forecast range, led by general merchandise sales as shoppers bought less groceries.

The company has forecast an increase of as much as 2 percent in April after same-store sales climbed 4.3 percent in March, the biggest gain in 10 months. The Bentonville, Arkansas-based retailer updated results through yesterday in a recorded call today.

Wal-Mart's food sales had outpaced general merchandise for nine weeks straight before this week's gain in general merchandise sales as record-high gasoline prices and the coldest March in four years discouraged spending on spring apparel. The retailer has been adding more stores that sell groceries to draw shoppers more frequently.

``I think Wal-Mart's bigger problem isn't the fuel prices, but the fact that they're relying so much on groceries as they've grown and built more supercenters,'' said Russell Jones, director of retail consulting at New York-based Alix Partners. ``That is just a lower-growth part of the business.''

Wal-Mart said April 7 that its first-quarter earnings will be near the low end of its forecast as sales of more-profitable items lag behind groceries. Net income in the quarter ending this month will rise to close to 56 cents a share from 50 cents a year ago, the company predicted.

``The discretionary spending, especially by lower-income consumers, is starting to ease up a little bit,'' said Patrick McKeever, a retail analyst at SunTrust Robinson Humphrey. ``Lower- income consumers are going to be pinched the most by higher gasoline prices.''

Tax Refunds

The average U.S. price of regular-grade gasoline hit an all- time high of $2.28 a gallon in the week ended April 11, according to the Energy Department. That's 28 percent higher than a year earlier.

U.S. retail sales in March rose 0.3 percent instead of the 0.8 percent forecast by economists in a Bloomberg News survey.

Income tax refunds and pent-up demand from March may boost retail sales in April, some analysts said.

The average tax refund as of April 1 was $2,568, an increase of 4.3 percent from 2004, according to the Internal Revenue Service.

``We're seeing a lot of tax-withholding receipts coming into the government,'' said Bill Cheney, chief economist at John Hancock Financial Services. ``That's real money. I think disposable income is in pretty good shape and people may have been knocked sideways by the price of gas, but that's a temporary phenomenon and we'll be back to spending pretty soon.''

Shares of Wal-Mart fell 26 cents to $47.70 yesterday in New York Stock Exchange composite trading. The stock has fallen 18 percent in the past year.

(To listen to Wal-Mart's recorded call, dial (1) (479) 273- 8446.)

To contact the reporter on this story: Lauren Coleman-Lochner in New York at llochner@bloomberg.net; Dan Hart in Washington at dahart@bloomberg.net.

Last Updated: April 16, 2005 08:55 EDT