Retailers rallied after the misery of the past few weeks, but the mood among many sector analysts remained resolutely downbeat.

Pali International noted gloomily: “We don’t think this bounce will be sustained. With the outlook for consumer spending worsening, the bad fundamentals will reassert themselves.”

Landsbanki, which was similarly pessimistic, published a hefty note on the retail outlook. The broker has slashed forecasts across the board by 5 per cent this year and by 12 per cent for next year.

The latest TNS grocery data, however, showed no sign that food retailers are running out of steam, according to Citi. The broker concluded that Tesco recorded its strongest growth in a year on a three-month basis and Asda and Morrisons were benefiting from their low price-positioning.

Broker Bernstein observed: “The relative performance gap between Morrisons, Tesco and Sainsbury’s is narrowing, suggesting that Tesco and Sainsbury’s can still compete effectively for a value-conscious consumer.” Separately, tycoon Robert Tchenguiz’s Sainsbury’s stake edged up, after he converted contracts for difference into ordinary shares.

Kingfisher’s completion of its turnaround team – having poached directors from Ikea and DSGi – impressed investors and prompted a share-price rise. Kingfisher was scheduled to update on trading as Retail Week went to press. Ahead of the numbers, Dresdner Kleinwort maintained its hold stance and was reviewing its 130p price target.

Debenhams’ stock was up after Kaupthing issued a buy note and argued that this autumn’s prelims may be a turning point for the retailer. The broker said: “While retailers are caught between a rock and a hard place, Debenhams has leeway on costs, scope to reduce debt to£800 million over two years and a trading strategy that is a good offset to the backdrop.”

Numis upgraded Mothercare from hold to add after last week’s first-quarter update. The broker said: “With defensive demand drivers, a strong international story and medium-term bottom-line growth underpinned by property savings and Early Learning Centre integration synergies, the stock deserves a premium to the sector.”

Menswear retailer Moss Bros named Jessops executive chairman David Adams as its new non-executive chairman. Chief executive Philip Mountford said Adams’ experience will be a “huge asset”, as the retailer focuses on its three-year improvement plan.

AIM-listed retailer United Carpets dissipated some of the gloom afflicting the homes market. Full-year profits climbed 46.8 per cent to£1.5 million on sales – including those of franchisees – up 8.8 per cent to£59.1 million.