Think back about five months or so, to the aftermath of Lehman’s collapse and tsunami-style turbulence in financial markets.

Retailers, already out of favour with many investors, were shunned as panic mounted that the tills would be silent over Christmas. But low valuations provided opportunity for some, who look well placed to benefit when recessionary conditions ease. There are signs now that more investors are following suit. Big retailers have frequently been up in a down market lately as investors bought into long-term value.

Among the early buyers was Paul Spencer, investment manager of Rensburg’s UK Mid Cap Growth Trust, who began to go overweight on retail four or five months ago.

He noted that retail stocks “good, bad and indifferent” were all being lumped together despite their differing prospects. He bought stocks such as Carpet-right and Mothercare, and has invested in Halfords and Greggs.

Few would argue that punishing trading conditions show signs of easing, but the share price rises of stocks such as Carpetright show that money can be made.

Spencer categorises his picks as “survivors”. Their characteristics include strong balance sheets and equally strong market positions, or low-ticket products that people are still likely to buy during the downturn. Analysts too, while still cautious about the retail outlook, see potential. Last month Singer, for instance, in a note entitled The Tide is Turning, First Wave, said “downgrade momentum is abating in the sector” and favoured geared recovery players such as Carpetright, Kesa and Topps.

There are doubtless other opportunities. US investors, for example, are keen on UK retail. Did you know that Kingfisher’s shareholder base is getting towards 60 per cent US? That’s is up from just under 50 per cent a year ago.

Life remains hard for the retail sector, but reports of its death are much exaggerated.