City File: DIY truce

KINGFISHER'S shares have under-performed the stores sector in the last year. The main worry has been the price war in DIY retailing, where Kingfisher's B&Q chain is the market leader.

B&Q will probably turn in a significant decline in profits in the half year to 1 August. Kingfisher, which also owns Woolworth, Comet and Superdrug, will do well to hold interim pre- tax profits at the pounds 62.5m achieved last time, when it reports on Tuesday. The market expects a slight fall.

But there are now signs that DIY wars are quietening down. Instead of offering blanket discounts, the sheds are limiting themselves to specific lines, notably paint at the moment.

The stock market has not fully absorbed the ceasefire. Assuming no outbreak of fresh hostilities, the shares are likely to do well short term. Longer- term they are a solid hold.