MARKET WATCH

RETAILERS will dominate the week with a clutch of sector heavyweights due to shed more light on the current mindset of consumers.

Retail bellwether John Lewis Partnership, which posts half-year figures on Wednesday, has found the going much tougher since it posted a 20 per cent jump in annual profits to £367.9 million for the year to 31 January.

The employee-owned firm has already stated that sales in the six months to 30 July will be up by 6.5 per cent, from £3.8 billion a year earlier, but like its peers the group has had to move swiftly to adapt to the poor economic backdrop. A year ago interim profits jumped by 28 per cent to £110.5m, but conditions are much tougher this time as the battle for consumers’ hard-earned cash intensifies and promotional activity impacts the bottom line.

One bright spot has been supermarket arm Waitrose, which has increased its market share despite the squeeze on consumer spending.

High street fashion chain Next – due to report its interims on Wednesday – is also having to deal with tougher times at its stores. However, it is buoyed by its online and catalogue business as directory and internet sales were up by 15.1 per cent in the 26 weeks to 30 July.

B&Q-owner Kingfisher’s first half has been a tale of two countries with a strong performance in France offsetting a weak UK, where the last quarter in particular was a struggle. Chief executive Ian Cheshire blamed the dismal weather, following the coldest summer for 18 years, and earlier sales of barbecues and other outdoor products due to the better conditions in the spring.

Analysts expect Thursday’s interims to be healthy despite the economic uncertainty and consumer squeeze in the UK.

John Guy, an analyst at broker RBS, suggests Kingfisher could even do better than expected due to currency exchange benefits on French trading and a stronger contribution from German DIY associate Hornbach.

Kesa Electricals’ shareholders will expect an update on the potential sale of UK high street chain Comet at its annual meeting. Latest reports suggest talks over a possible disposal have broken down and that Kesa will be forced to push through its own self-help programme to rejuvenate the struggling retailer.