The Week Ahead: Hoping for high street help from Debenhams

Debenhams becomes the latest of the big high street retailers to update the market tomorrow, after a run of results that have buoyed the beleaguered sector.

Impressive updates from Next and Kingfisher helped the department store's share price climb 14 per cent last week, adding to recent improved sentiment in a sector that has had a tough summer.

When Debenhams last released figures, in June, it said like-for-like sales for the first four months of the second-half had risen 1.5 per cent. Peel Hunt's John Stevenson expects any end-of-year rise to have slowed, but does not think it the reduction will be huge, citing figures from John Lewis that show "the middle ground appears to be showing more stability" than other areas.

Singer Capital, meanwhile, predicts August will have been tough, highlighting recent sector-wide data that revealed a 4.4 per cent fall infashion sales over the month and suggested that "mainstream retailers" were badly hit by a drop in footfall.

The broker, therefore, calculated that sales growth for the second six months of the year would be 1 per cent, adding that its margins "may also be squeezed given the bigger reductions needed to complete [its] final clearance [sale]."

Still, the analyst is not all doom and gloom. It said the summer'sspecial circumstances – such as the riots – suggest August's trends will not necessarily continue. It also points out that in spring Debenhams should start to benefit from a recent fall in cotton prices, although it does warn of a worsening macroeconomic situation in the run-up to Christmas.

Today

the week begins with Dairy Crest's first-half trading statement. It last updated the market in July. Then, the group – whose brands include Cathedral City and Utterly Butterly – warned of an "increasingly tough trading environment", though it did say its top brands were impressing.

Numis Securities' Charles Pick expects this trend to have continued, with top-line growth from its major products "aided by price rises to recover higher input costs". He also said that the company's cost-saving programme will have remained on track, thanks to new brands, such as children's cheese-snack Chedds, and a number of self-help initiatives.

Also announcing figures on Monday is Ocado, the online grocer that continues to split opinion in the City. As he has a target price for the group of 50p, it is fair to say Panmure Gordon's Philip Dorgan is not a fan, and he believes its third-quarter update will show its sales to have been knocked "by capacity constraints".

JP Morgan Cazenove highlighted the same issue. The broker said its sales growth for the period will be around the same as for the previous three months, when it rose 17 per cent. However, its analyst said it remains "confident that [Ocado] will hit the 140,000 average weekly orders target by the end of the year".

Results/Updates: Dairy Crest, Ocado.

Tomorrow

Updates: Carnival and Debenhams.

Wednesday

Imperial Tobacco's trading update on Wednesday, ahead of the close of its financial year at the end of the month, is not expected to be lengthy. Nomura believes the cigarette manufacturer will announce a 2.2 per cent drop in volumes for the full twelve months, which would suggest a 2.5 per cent fall over the fourth-quarter.

Also releasing figures is JD Sports with its interim numbers, after its first-quarter like-for-like sales dropped 2.8 per cent, mainly because the same period in 2010 contained the World Cup.

With a tough comparative now out of the way, Numis Securities' Andrew Wade expects that a rally will result in its sales growth for the first half of the year ending up only slightly negative.

Results/Updates: Imperial Tobacco and JD Sports.

Thursday

euromoney, which issues a pre-close update on Thursday, is expected to reveal a more cautious outlook than when it released its interim management statement back in July, according to Altium. The broker is wary about the events organiser and business-to-business publisher.

Altium expects it to be most upbeat over events and subscription revenues, but warn that they will be looking out for "any signs of weakness in adverting and sponsorship ... [and] an update on the impetus being delivered by organic investment in new products, technology and headcount."

Results/Updates: Euromoney, Tui Travel and United Utilities.

Friday

Results/Updates: No major companies are expected to report.

ECONOMICS DIARY

Today

Rightmove house price index.

Tomorrow

Eurozone economic sentiment survey; Nationwide consumer confidence; US building permits; US housing starts.

Wednesday

Bank of England MPC meetingminutes; Public sector finances; US existing home sales; US Federal Open Market Committee rate decision.

Thursday

CBI trends data; Eurozone consumer confidence; Eurozone industrial new orders; US leading indicators; US unemployment figures.

Friday

Eurozone PMI surveys.