The news fueled a rally on Wall Street, helping to push the Dow Jones industrial average up 203.82 points, or 2.1 percent, to 10,005.96.
Year-over-year retail sales rose 1.8 percent, the best showing since June 2008 and the second consecutive month of gains, according to Thomson Reuters' tally of 30 major chain stores.
In a promising note, upscale chains Nordstrom Inc. and Saks Inc. beat expectations, showing that affluent shoppers may be loosening their purse strings on high-end items.
"Further evidence of retail recovery continues to unfold as October comparable-store sales have outperformed the year-to-date reading in every category," said Michael Niemira, chief economist of the International Council of Shopping Centers.
Retailers are hoping consumers will carry the momentum through the holiday season. But industry watchers warned that a full turnaround was still to come and cautioned that one reason the results were strong was because it was easy to beat the dismal performance of October 2008, when sales fell 4.1 percent.
"We're certainly in a consumer recovery, but it's off of considerable lows," Niemira said. "We're sort of scraping our way out of the bottom."
Off-price retailers reported the biggest increases in October sales.
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