As pressure continued to bear down on general retail stocks, Nomura and Espirito Santo issued notes assessing prospects.

Both adopted a neutral stance, but Nomura was more bearish. The broker said: “We see further downside risk, with consensus like-for-like sales potentially too high across the sector. Our average current like-for-like for 2011 is -1.9%, and -0.5% for 2012.”

The broker was cautious on Home Retail Group because of fears about how big-ticket categories will perform and said that apparel groups faced a markdown risk despite Next “buying sensibly” and Marks & Spencer driving market share. Tesco and Morrisons are among Nomura’s top picks.

Espirito Santo noted that general retailers had underperformed the market by 4% this year, but said: “Consumers’ expectations and outlook have fallen to such a degree that we feel a lot of bad news has already been accounted for.”

M&S, Kingfisher and Dixons Retail were the broker’s key buys. Home Retail was a sell, as was Next because “it is in a worse position relative to clothing peers to pass through price inflation”.

Following Capital Shopping Centres’ results on Wednesday, when the property firm reported rising rent settlements, Singer flagged the issue as a threat to retailers.

The broker said: “The trend for retailers over the last two years has been much more benign than pre-credit crunch, so if they do demand and succeed in driving reviews up, this would clearly be a negative for the sector and main tenants including Marks & Spencer, Debenhams and Next.”

Upscale group Burberry once again won good reviews during London Fashion Week, and Seymour Pierce reiterated its buy advice. The broker believes Burberry can deliver 20% earnings growth for the foreseeable future and said: “It not only has geographical, product mix and leverage opportunities that can be financed by internally generated cash, but it also operates in a market with strong growth credentials.”

Online food specialist Ocado was a loser after founder Tim Steiner sold 6.7% of his holding through a trust. Shore Capital, which rates Ocado a sell, fears that Waitrose’s increasing internet ambitions in Ocado’s heartland pose a competitive threat.

As Tesco chief executive Sir Terry Leahy prepares to hand over the reins to Phil Clarke next week, Shore Capital issued a buy note on the grocer. The broker said: “As ever, there is scope for improvement, fine-tuning the UK and more fundamental decisions in the US. Growth on growth, increasing cash flow and rising returns should lead to rating expansion.”