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Marks & Spencer festive sales woe expected

MARKS & Spencer failed to set the high street alight at Christmas, with analysts warning the retailer will disappoint investors when it reports its festive trading update on Thursday.

Sales of general merchandising are forecast to have toiled in spite of aggressive discounting activity, including a "Mega Day" which offered 30% reductions on clothing on the Saturday before Christmas.

Although food sales are expected to have grown by 1.5% to 2% in the three months to the end of December, analysts anticipate that homeware and clothing will have fallen between 0.5% and 1.5%.

The figures are expected to heap pressure on chief executive Marc Bolland, who had pinned Marks' festive hopes on a revamped autumn/winter clothing range advertised by stars such as Helen Mirren.

So far Christmas has proved to be a mixed bag for UK retailers. Next, John Lewis and House of Fraser reported strong figures last week, while a profit warning was issued by Debenhams.

Tesco and Sainsbury's are expected to show it has been a tough Christmas for the "big four" supermarkets when they report this week. Analysts have pencilled in a 0.3% fall in like-for-like sales Sainsbury's, which would break its run of 35 quarters of growth, while sales at Tesco are forecast to have slid between 2% and 2.5% in the six weeks to January 4.

A survey by BDO found sales at mid-market retailers were down 2.2% in December compared with last year.

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