Christmas prices come early to Wal-Mart

updated 3:34 p.m. ET Oct. 2, 2008

Christmas is coming early for Wal-Mart. Expecting a weak holiday shopping season, the company announced Wednesday it would be cutting prices on several toys in 3,500 stores across the U.S.

Wal-Mart said it made the call after conducting a survey that showed consumers will start Christmas shopping earlier this year in order to stretch their holiday dollars.

Though Wal-Mart caters to low-income shoppers, retailers have been hurt by sluggish spending due to rising food and energy prices, the housing slump and a generally weak economic climate. The industry doesn't see a quick fix to those trends and is anticipating a subdued holiday season.

Wal-Mart's shares were effectively flat on Oct. 1, losing only 0.03 percent, or 2 cents, to $59.87, in morning trading. The reaction may appear to send a message of indifference, but the price was strong compared with the Dow Jones industrial average, which fell 1.6 percent, or 170.05 points, to 10,680.61.

Wal-Mart said it will cut prices on 10 popular toys to $10.00 each, including certain Barbie Dolls, Play-Doh Ice Cream Shop, specific Hot Wheels toys and Bakugan by Spin Master, a game many experts cite as one of the "hot" toys this year.

More from Forbes.com Click links below for slide shows ‘Tis the season to be frugal Wal-Mart rises above the fray Big companies that are hiring The 10 least profitable businesses to start Wal-Mart toys with Xmas strategy

It will also open Christmas shops within its stores over the next 10 days, which will offer deals such as an ornament value pack for $5.00.

Thanks to its size, Wal-Mart has fared better than its industry peers through this weak period by aggressively cutting prices. Last month, the company reported an increase in August same-store-sales, while others such as J.C. Penny faltered.

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