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Retail

Investors hoping Mothercare will lift UK gloom

Mother and baby retailer is due to report first quarter trading

Mum and baby goods retailer Mothercare plc (LON:MTC) is expected to provide the interest in a quiet day for company news on Friday.

The retailer, which now does most of its business overseas now rather than in the UK, is due to report a first quarter trading update.

Investors will be hoping Mothercare's UK business has continued the outperformance it reported in its full-year results.

The company has restructured its UK operation, including improvements such as shop refits, and has made like-for-like sales and margin gains.

Analysts at Peel Hunt said: "We expect this to continue and look for low single-digit like-for-like growth in the first quarter."

But the broker expects a 9% fall in revenues from the group's important international business.

"While much of this reflects weaker economic activity and adverse currency movements, in the aftermath of the EU Referendum and weaker sterling, there may be opportunity to pass on the benefits to the international partners and boost demand," Peel Hunt said.

Meanwhile, investment manager Rathbone Brothers plc (LON:RAT) was expected to report a boost in the first half as investors hunted for bargains following the EU referendum vote.

Peel Hunt tipped Rathbone to report a modest increase in fee income over the previous quarter, although commission income was set to be harder to predict, given economic uncertainty.

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