Marks & Spencer figures set to lighten the Christmas gloom

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The Independent Online

Stuart Rose, the newly knighted Marks & Spencer chief executive, is this week expected to deliver some badly needed cheer to investors and the high street when he reveals that the group enjoyed a stronger Christmas than many of its rivals.

Following a disastrous first week of Christmas numbers from DSG, Next, Kingfisher and Land of Leather, which shed nearly half of its value on Friday after a profits warning, Mr Rose is set to reveal that same-store sales leapt by more than 1 per cent during the third quarter. However, the pace of growth is likely to be the slowest at M&S since 2005.

The company's shares fell by more than 4 per cent on Friday as they were pulled down by negative sentiment hitting the sector. Philip Dorgan, retail analyst at Panmure Gordon, said: "Basically I think that a lot is already discounted in its shares. Just as a year ago, nobody wanted to sell the retailers and look what has happened. While there will obviously be more profit warnings to come, we would expect the likes of M&S, Tesco and Carphone Warehouse to do well in share price terms in 2008."

According to financial publisher Bloomberg, 17 out of 24 City analysts surveyed have a "buy" recommendation on the stock. Last week a note from Goldman Sachs claimed M&S would probably be the pick of the high street in 2008, while bottom of the pile was likely to be jewellery retailer Signet, which also issues a trading statement on Thursday. Shares in the H Samuel owner were hit hard last week, losing more than 16 per cent of their value.

Other high-street names delivering trading updates this week include Greggs, J Sainsbury and Restaurant Group, which owns the Garfunkels chain.

Meanwhile, figures from the British Retail Consortium (BRC), released on Tuesday, are likely to show the extent to which the high street suffered last month. The BRC's retail sales monitor grew by a modest 1.2 per cent in November amid apprehension about the festive sales period. Retail experts are predicting a 0.8 per cent rise in like-for-like sales on the same period last year, with post-Christmas bargain hunting rescuing the season.

However, the idea of a long-term revival in consumer fortunes is likely to be scuppered this week, with figures from the Halifax showing a continued fall in house prices in December.