A host of the high street's biggest names took a stock market hammering today as the first flurry of Christmas trading updates spooked investors.
Currys owner DSG International saw shares tumble more than 22% after admitting profits would be up to £50 million lower than market hopes after "disappointing" festive trading.
Downbeat predictions of a "worsening consumer environment" in 2008 as shoppers face higher mortgage bills also sent fashion chain Next down nearly 5%, despite upbeat expectations for current year profits.
In a sign of growing pressure on retailers, Next also warned that like-for-like sales from its high street outlets would shrink for the fourth year in a row during 2008.
The gloomy news saw B&Q owner Kingfisher worst-hit in the FTSE 100 Index, with shares down more than 7%. Home Retail Group, which owns Argos and Homebase, also fell nearly 7%, while Marks & Spencer was down more than 3%.
Alongside DSG in the FTSE 250 Index, Comet owner Kesa Electricals and H Samuel jeweller Signet were also under pressure, with 8% and 7% falls respectively.
Next and DSG both called for interest rate cuts from the Bank of England to follow last month's move and ease the pressure on consumers.
DSG finance director Kevin Byrne said: "A reduction of interest rates would help and would send the right message, and that's what a lot of people are expecting."
Next finance director David Keens said: "There's no point us trying to kid ourselves that we are going to have anything other than a difficult year."
Majestic Wine, the UK's biggest wine warehouse chain, also reported slowing sales today with a late festive boost failing to offset a "disappointing" November for the group.
City experts are now braced for more bad news from retailers giving Christmas trading updates over the coming weeks.
Richard Hunter, head of UK equities at stockbroker Hargreaves Lansdown, said: "Along with the statement today from DSG, it seems that the festive cheer has already evaporated on the high street.
"The comments from Next, whilst understandable, were not what the market wanted to hear. The underlying trends, along with the company's cautious comments, have provided little scope for optimism."
Despite its share price coming under pressure today, analysts picked out Marks & Spencer as a likely safe haven in a difficult year on the high street.
Panmure Gordon analyst Philip Dorgan said: "We believe that M&S's defensive characteristics will come to the fore in what is likely to be a tough year for the consumer.
"Half its sales are in food, its property backing remains strong and its product offer is now much more sensibly priced."
M&S is due to update on its Christmas performance next Wednesday. Trading statements are also expected next week from supermarket giant Sainsbury's, Signet and sportswear retailer JD Sports.
Tesco, Mothercare, Woolworths and Home Retail Group should all report the following week, along with music retailer HMV, and Kesa.