David Prosser: Only two cheers for Marks & Spencer

Outlook Marks & Spencer delivered amasterclass in the art of managing expectations yesterday. That the economic recovery on the high street has stalled has been obvious for weeks now, with retailers falling over each other to report lower sales, to warn on profits and, in several cases, to call in administrators. Analysts and investors had thus been waiting for M&S's first-quarter update with some trepidation. And when the company published a handy poll of analysts' forecasts last week, the panic began to set in. The consensus was for a 2.5 per cent year-on-year fall in like-for-like sales, it pointed out.

Stock market rules prevented the retailer offering any commentary on the accuracy of the figure, but getting it out there was enough to trigger another round of dismal stories about the health of the high street. And then M&S's update hit the screens for real: it revealed that rather than falling, sales were actually up by 0.1 per cent over the period in question. Cue a sharp rise in the retailer's share price and some thoroughly supportive headlines about it defying the slowdown.

Let's not be churlish. M&S's latest trading has been more impressive than the performance of many other retailers. And with the consumer headwinds it is facing, even flat sales, achieved by improving market share, are something about which it is entitled to feel proud.

Still, a 3.9 per cent fall-off in non-food sales is depressing stuff. And the counterbalancing 3.4 per cent gain from food was achieved with the help of rampant inflation in the grocery sector. No wonder the retailer remains so cautious about the rest of the year.