There was mixed news from the British retail sector yesterday. More than £1 billion sterling (£1.26 billion) was wiped off the market value of Dixons Group, Britain's largest electrical retailers. The company also has stores in Dublin and Galway.

The fall came following Dixon's disclosure of downward pressure on trading margins in deflationary retail markets. Despite buoyant first half profits, 20 per cent uplift in the interim dividend and £121 million cash-back to shareholders, Dixons shares slumped 311p, (or 21 per cent) to 1,149p where the group is valued at just on £5 billion.

However British retailer Marks & Spencer beat expectations by reporting a smaller-than-expected decline in Christmas sales. M & S shares rose smartly as the 5.3 per cent decline in sales over the 15 weeks ending January 8th confounded pessimists, who had expected a profit warning. M & S also reported general merchandise sales down by 8.8 per cent and food sales up by 1.2 per cent.

"This is not a profit warning. However, the figures clearly are just not good enough," M & S chief executive Mr Peter Salsbury said.