Last week’s shock news that Morrisons chief executive Marc Bolland is leaving to head Marks & Spencer helped pull down the food sector relative to general retailers.

Morrisons’ shares were among the week’s steepest fallers but broker Bernstein rates the retailer market-perform following the grocer’s third-quarter update. Bernstein said: “With tactical plans well developed – notably for the critical Christmas period – and Morrisons’ ‘national to nationwide’ strategy well ingrained, we do not expect Bolland’s departure to meaningfully impact trading results in the coming months. “However, the broker cautioned that the changeover of bosses would delay discussion of future strategy.

Tesco was flat over the week, despite holding analysts’ briefings on its services operations. Jefferies rates Tesco as a buy and said: “Tesco’s customer reach and consumer insight have already set a strong foundation for the services offering to expand on.

“Tesco Bank provides the biggest opportunity but growth will be gradual as the infrastructure is set up medium term. Retail performance should remain the major share price determinant near term.”

Investec weighed up the outlook for general retailers following the sector’s rise this year and sounded a note of caution. The broker noted: “We are seeing a shift in the relative valuations between stocks and, as we head into the uncertain prospects of 2010, we believe it is time to take some money off the table, particularly in the more discretionary-focused stocks or where valuations are looking excessively optimistic.” Investec said DSGi and Halfords were its key buy recommendations.

Fashion group French Connection reported 0.3% like-for-like growth at its core UK and Europe retail division, and total sales growth of 0.6% in the 16 weeks to November 24. Group turnover in the three months to October 30 rose 8% year on year, mainly as a result of exchange rate differences. House broker Numis has a hold stance and said a strategic review is ongoing. “Having exited Japan, the group continues to evaluate its options to improve profitability and cash flow,” said Numis.

Jeweller Signet reported that like-for-likes fell 1.9% in the 13 weeks to October 31 – performance was similar in both its UK and US markets. Total sales fell 2.5% to $613.7m (£369.3m).

Nomura increased its Kingfisher price target from 220p to 300p ahead of the retailer’s third-quarter update. The broker sees potential for B&Q to double its penetration of the trade market and drive sales densities. “We remain neutral on the stock but see further upside to our 300p target with less conservative forecasts and strong execution,” said Nomura.