The nation’s retailers slashed prices further today in hopes that a post-Christmas shopping rush will salvage holiday sales that, so far, have fallen below even modest expectations. In particular, they are waiting for legions of shoppers armed with gift cards to snap up bargains and buy new merchandise still on store shelves.

Merchants in past years have received a late bounce during big clearance markdowns and they find themselves again in the position of hoping that bargain-hunting consumers will come through in the end.

Investors, however, grew pessimistic about this holiday season as well as the financial well being of consumers amid a challenging economic environment. Shares of most retailers fell today, led by Macy’s Inc. which sank as much as 5% in afternoon trading.

“Shoppers are thinking twice about what they are buying,” the president of an equity research company Jennifer Black & Associates, Jennifer Black, said. “There’s a feeling of worry.”

Ms. Black, along with other analysts, made the rounds at malls in Oregon and New Jersey, noting that even with gift cards, shoppers remained tightfisted today, focusing on bargains despite fresh offerings from merchants.

“My son gave me gift cards for clothes, and I get up with the birds, so I figured I’d get the most with my money,” a woman who was loading discounted pants and sweaters into a cart at Kohl’s in Medford, Mass., Susan Depetris, said.

The International Council of Shopping Centers said today that same-store sales, or sales at stores opened at least a year during the November-December period, are coming in just below already slim projections for a 2.5% gain, though it said that a post-Christmas buying splurge could erase that shortfall. That contrasts to a more upbeat assessment from its chief economist Michael Niemira, following the weekend’s spending surge, who predicted that holiday sales could at least meet forecasts.

Target Corp. warned late Monday that its same-store sales might decline for December, while a broad gauge of consumer spending released by Mastercard Advisors, a division of the credit card company, which includes estimates for spending by check and cash, reported yesterday an increase of 3.6% from Thanksgiving to Christmas. That compared with a 6.6% gain in the year-ago period.

“The ingredients were not there for a blockbuster season,” a vice president at MasterCard Advisors, Michael McNamara, said. “And retailers in many respects got the most out of the season that they could based on the environment.”

Shoppers jammed stores at the start of the season, but held out for deals through most of December only to return for a last-minute spending spree when the bargains were even better. Higher gasoline prices, an escalating credit crisis, and a housing slump made shoppers cautious, which has manifested itself in weakening sales growth throughout the year, Mr. McNamara said.

To spur business, stores early on were aggressive with discounting, raising concern over stores’ profit picture during this crucial period. The holiday season accounts for up to 30% of annual stores sales. For toy sellers, holiday business accounts for as much as 50%.

A better tally of how retailers fared won’t arrive until at least January 10, when major merchants report final same-store sales figures for December. Merchants are slated to report fourth-quarter profits in February.

The biggest loser is women’s apparel, which has been one of the weakest performers and will see its profits hit hard, analysts said. But there are signs that the luxury business could be softening too. At Houston’s upscale Galleria mall, the luxury menswear store Bernini was empty despite large 70% off signs.

“People are spending less and they’re being really picky,” a salesman who called it the worst season in his three years at Bernini, Cleveland McMakin, said.

Even $995 leather jackets marked down to $299 and $595 blazers being sold for $179, did not spark optimism.

“We’ve never marked stuff down this low before,” Mr. McMakin said. “We’re just trying to sell it.”

Retailer woes can be good news for shoppers, who are being bombarded with more generous discounts in the after-Christmas period than a year ago, industry officials said. A senior vice president of marketing at mall operator Macerich Co., Susan Valentine, said discounts on holiday decor are reaching 75%; last year at this time, decor was reduced up to 60%. Meanwhile, apparel is being slashed to up to 70%; last year, the price cuts were around 50%.