The festive season may be in full swing but it is worries about next year that are hitting general retail shares, which underperformed the market this week.

The respected GfK NOP Consumer Confidence Index fell in November, with those questions relating to future confidence showing the biggest falls.

Brokers fear that once Christmas is out of the way, discretionary spending in the new year will suffer.

“We suspect that overall confidence levels are likely to fall further over the coming months as the public start to feel the full impact of the Government’s spending cuts and tax changes and as house prices move into reverse,” said Singer Capital Markets analyst Matthew McEachran.

Dixons revealed a reduced first-half loss of £7.9m compared with £17.6m last year on the back of flat group sales, but said it was gaining share in all its markets.

Buy, says UBS, which despite having concerns about Christmas in the UK, says Dixons “remains an attractive investment” in the longer term.

Topps Tiles was in favour, with the City welcoming the return of a final dividend, and a pre-tax profit at the upper end of expectations despite the difficult home market. Buy, says Oriel, adding that “despite continued severe headwinds, Topps Tiles continues to make a much improved fist of things”.

Debenhams showed off its spring/summer ranges to analysts, but the big talking point was the increase in sourcing costs.

According to Seymour Pierce, which rates the shares a buy, the department store chain thinks average selling prices will rise by more than the 6% previously guided.

However, the broker said cotton prices had now come down from their high point and added: “We feel this cotton spike, which has been exacerbated by local specu­lators, will turn out to be a one- season effect.”

Tesco reports third-quarter trading next week and Jefferies - which rates the shares a hold - expects sales growth of 6%, excluding VAT, with a strong international performance being counterbalanced by an “anaemic” showing in the UK.

Shore Capital initiated coverage of WHSmith with a buy recommendation. The broker said that increasingly the high street and travel businesses were being run as separate entities able to stand on their own feet, and that the company’s current share price “does not reflect the true value of its businesses”.

Kingfisher was due to report third-quarter trading as Retail Week went to press.

Arden Partners said the company had “been softening the market up for some weak B&Q sales numbers, with -6 or -7 being mooted”, but rates the shares add, saying they represent good value at their present level.