The Government administered emergency surgery on beleaguered banks but retailers remained under pressure as the share prices of grocers and general merchandisers alike fell over the week.

WHSmith lightened the gloom with good results and Burberry managed continued sales growth. However, investors were worried by Tesco’s showing in the latest TNS data.

JP Morgan cut its Tesco target price from 390p to 340p. The broker said: “Since early December last year, Tesco has consistently grown more slowly than the UK grocery market. Considering that Tesco is adding more space than the other three major grocers combined, we consider such trading performance disappointing.”

Buy Carphone Warehouse, advised Investec, as details of its partnership plans with Best Buy emerged. The tie-up would increase competition in electricals, piling pressure on incumbent market leaders DSGi and Kesa. The management of both “have every right to be afraid – very afraid,” said Investec.

Numis put crisis-hit JJB Sports under review after the retailer disclosed that it might sell non-core assets – understood to refer to its Original Shoe Company and Qube chains. Numis said JJB was precariously placed and although it probably has a sustainable high street position, “only the sale of the health clubs will underwrite the current equity holders”.

Seymour Pierce downgraded Home Retail from buy to hold ahead of next week’s results. The broker argued that Argos is reaching maturity in terms of store numbers and DIY chain Homebase is “structurally challenged”. In the light of growing competition from grocers and economic conditions, the broker said Home Retail is fairly valued.
Entertainment specialist HMV has bought Gamerbase, which already runs a game-playing concession in the retailer’s Trocadero store. Gamerbase will now open in several more stores over the next 12 months, starting in Manchester’s Market Street shop.

Debenhams posts full-year results next week and Pali, urging sell, cut its target price from 40p to 33p. Baugur vehicle Unity holds 13 per cent of Debenhams’ shares, which may have to be liquidated and Pali says 33p “could be the mark”.

JP Morgan has downgraded Next from neutral to underweight on the back of concern about likely consumer spending patterns, which may put volumes under pressure for the next two years. “We think consensus earnings forecasts are too high for 2009,” the broker warned.

Retailers updating next week include Sports Direct. Panmure Gordon slashed its target price from 65p to 30p for the retailer, concerned about high debt and EBITDA prospects.

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