CHRIS VERSACE: Good morning, Action Alerts Plus members. We'll kick off today's rundown with this morning's retail sales report, which came in far stronger than the market was anticipating. Now, we expected the prospect of a stronger print given Amazon's 2023 Prime Day as well as those competing offers from the likes of Walmart, Target, Best Buy, and others. And when we look at the report, boy, that was certainly a contributing factor.
Comparing the 10.3% year over year print for digital shopping in July versus the 9% figure for the trailing three months, it simply tells us that consumers were embracing those digital shopping events. To us, that adds another dimension to Amazon's comments about this year's Prime Day. It also tells us the company is starting off strong for the current quarter. Now, in last week's roundup, I shared that we were becoming incrementally bullish on Amazon shares.
And with the July retail sales data in hand, we indeed are reviewing our current three rating on the shares. Two other notable areas of strength in the July retail sales report were ones that you members identified in last week's poll of the week. The poll called out restaurant spending as the greatest driver of overall retail spending in July. And the category clearly showed the fastest year over year growth in that category of restaurants.
And like digital shopping, the July data for restaurants pointed to greater spending in July compared to the last few months. Now, we see that as a rather positive data point for our shares of not only Chipotle but recent portfolio addition, McDonald's. Taking another look at the retail sales report, the same was true for the grocery category, a positive for PepsiCo shares, which for members are back in the buy zone.
And of course, when we talk retail sales reports, we have to touch on Costco. The July retail sales report confirmed without question Costco picked up consumer wallet share during the month. And once we have Costco's August retail sales report in hand, we will address our current Costco price target most likely with an upside bias. With all of that said, we the July retail sales report is something of a rear view facing collection of data.
And given our concerns about consumer spending headwinds, something we spelled out to you in today's opening comments, we suspect that not only ourselves, but the market will be placing far greater weight on retailer guidance this week and next. We will be updating our thoughts as we aggregate all of those comments. But today, tucked inside quarterly results from Home Depot, the company noted that it is seeing pressure in certain big ticket items and in discretionary categories.
Now, in reviewing Home Depot's results, we'd also call out that we saw a decline in customer transactions, a fall in sales per square foot, and operating margins declined versus the year ago level. Now, no question, all of this points to consumers being more selective in their spending continuing the trend that we've been seeing. Home Depot's results are but one piece of the puzzle. And again, we'll get far more puzzle pieces in the coming days.
However, between the July retail sales report and retailer comments both last week and so far this week, it speaks rather well for how we've positioned the portfolio. Finally, let's quickly touch on the news of the day weighing on the stock market. Outside of the US, China delivered a surprise rate cut something that aims to give its sagging economy a lifeline. Today's slowing industrial and retail sales data out of China is only the latest in a growing number of disappointing economic data points for the country.
Now, we suspect that China will have to do even more to re-accelerate its economy. And in our view, today's data as well as China's interest rate action reaffirms our thinking that the US economy is the best economic house on the block right now. And we're likely to see that spill over into the dollar and other areas as well. Members, that'll do it for today's rundown. JD and I will be back tomorrow to answer some of your biggest questions of the week.