Britain may be basking in some spring sunshine at last but the forecast is for more chill economic winds this week, with the UK’s largest retailer once again finding itself at the centre of the storm.

With Tesco poised to announce the offloading of its US Fresh & Easy venture and an anticipated fall in annual profits following the fightback at Christmas, all eyes in The City - as well as at its Cheshunt HQ - will be on the impact on its share price, which had rallied over recent months.

If the £1bn revamp of Tesco stores is seen as only producing a temporary blip, rather than a long-term reversal of its fortunes, there will be some tough questions asked of CEO Philip Clarke – and that’s before the £1bn bill for sounding the retreat from Fresh & Easy is thrown in.

Clarke is expected to announce on Wednesday plans for a much wider makeover of its larger stores, which will be given new restaurants and coffee bars, as the retailer tries to adapt to the all-pervasive impact of online shopping.

However, Tesco shareholders will not be alone in nervously monitoring their stocks as they sip on a cup of strong black coffee from Harris+Hoole.

The very next day the Office for National Statistics is expected to show a year-on-year fall in retail sales of around 0.6%, and a month-on-month decline of 0.8% - thanks in no small measure to the bitter March weather.

“This report is expected to dampen some of the positivity from February’s report,” says Joshua Raymond of Cityindex.co.uk.

Raymond says the Q1 results for the likes of Tesco are a barometer for the impact of the big freeze and the horsemeat scandal, on top of what was already a crisis in consumer spending, even in the relatively resilient food sector.

“We will get a good gauge of progression in this sector when the likes of Tesco announce their earnings,” he says.

“A better-than-expected result for UK retail sales in March could see UK retailer share prices rise on expectations that their forthcoming results will see similar success. On the other hand, a bigger-than-expected decline in sales could trigger profit-taking by those investors who have bought into the sector.”

It promises to be a volatile few days.

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