Market watch: Marks & Spencer toughing it out on high street

Marks & Spencer is set to reveal increasing sales growth on Wednesday as it shrugs off the tough conditions on the high street.

Analysts expect the retailer to report a 1.5 per cent increase in like-for-like sales in the 13 weeks to the end of June, up from the 0.1 per cent increase in the previous quarter.

M&S is expected to have reversed a decline in sales of general merchandise, but food sales are believed to have slowed to 3 per cent from 3.4 per cent the previous quarter amid fierce competition with the supermarkets.

The owner of the Superdry fashion chain is expected to reveal that profits have nearly doubled in its last financial year despite the misery on the high street for many rivals.

Analysts expect SuperGroup, which also owns Cult stores, to post an 87 per cent rise in underlying profits to 49.6 million in the year when it updates the market with its results for the year to 1 May on Wednesday.

The chain, whose clothes are worn by celebrities such as David Beckham and Leonardo DiCaprio, is expected to have bucked the trend of declining sales on the high street because its clothes appeal to a young market and it has pressed ahead with ambitious expansion plans at home and overseas.

A major sell-off was sparked when the group admitted that its sales had slipped after it did not get its spring and summer ranges into its 61 stores in time to take advantage of the unseasonably warm weather.

But in its most recent update the group claimed that its growth plans remained on track and said trading had been strong in recent weeks.

Sportswear and sporting goods retailer Sports Direct has enjoyed a major revival in its fortunes over the past year. The share price has more than doubled and as other retail groups on the high street struggle to survive it has started to buy.

This week it picked up two luxury brand chains, USC and Cruise, from Scottish retail entrepreneur Sir Tom Hunter for 7m to form the basis of a new premium and lifestyle division It is a change of direction for a group that has traditionally been associated with a less affluent demographic.

Analysts expect this week's full year results to cap a good 12 months for the group, which owns more than 350 stores in the UK.

Consensus forecasts are for next Thursday's figures to show annual underlying profits have risen to about 155m from 120m, while sales come in near to 1.6 billion, up from 1.45bn, helped by heavy promotions and the struggles of rivals such as JJB Sports. The figures could also trigger a bumper payout for 2,000 Sports Direct staff, who are set to pick up an estimated 10.8m from a bonus scheme.Mothercare's first quarter update on Thursday will be keenly scrutinised for any signs that it has managed to bring an end to the recent run of poor trading. Mothercare recently announced plans to close 110 stores after like-for-like sales in the UK dropped by 4 per cent in the year to the end of March.

The Watford-based group will give its first update on trading in the period since, which has seen a spate of retail failures as Jane Norman, TJ Hughes and Habitat fell into administration.

Its new plans will see it focus more on larger out of town Parenting Centres, which contain its Early Learning Centre brand, as it closes underperforming outlets on the high street. Rents will be cut on a further 40 stores. Chief executive Ben Gordon recently said he expects the UK retail environment to remain challenging, but plans to step up its international expansion.

Inflation is expected to have remained at more than twice the Bank of England's target when official figures are published on Tuesday.

Economists predict Office for National Statistics data will show the Consumer Prices Index (CPI) measure of inflation for June will be held at 4.5 per cent - its highest level for more than two years.

It will be the 19th month in a row that inflation has been above the Bank's target of 2 per cent. The unchanged figure will maintain pressure on the Bank of England to raise interest rates.