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PLANO, Texas—J.C. Penney Co. will further slow the pace of new department store openings and cut capital spending next year because of the weak economy.

The company said Wednesday it now plans 20 new or relocated stores next year, down from the 36 it expects to open in 2008.

Penney had once planned 50 new stores a year through 2011, but backed away from that goal in April, when it set the target of 36 new stores this year.

Penney and other retailers have been slumping as their middle-class customers struggle with higher gasoline prices, a slowing economy and...