A profit warning (16 Dec) from women’s value fashion retailer Bonmarche (BON:AIM) offers a negative read-across for apparel retailers. Unusually warm weather has made winter ranges tough to shift and triggered drastic pre-Christmas discounting from clothing purveyors, many of which could disappoint with their January trading updates.

Shore Capital’s Clive Black doesn’t believe Bonmarche’s warning and disappointment ‘will be the last to be recorded by British retailers’.

Feeling the heat are store-based players, hardest-hit by Black Friday disruption and the continuing shift online. Higher markdowns are needed to shift unsold lines across the clothing sector; hence the last-ditch promotional bid dubbed ‘Panic Saturday’ (19 Dec), the weekend before Christmas.

Nervousness is building ahead of January updates from high street players Debenhams (DEB) and Marks & Spencer (MKS). Indeed, recent checks run by FinnCap revealed that Marks & Spencer (MKS) had an over-allocation of outerwear and jumpers, meaning a high proportion of the store was on markdown. And while SuperGroup’s (SGP) interims (16 Dec) smashed expectations, the figures covered the half ended 24 October, meaning Christmas trading remains tough to call.

Perhaps best-placed are pure-play online fashion retailers such as ASOS (ASC:AIM) and Boohoo.com (BOO:AIM), which entered the sales much later than in previous years, buoyed by continuing online momentum.

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Be cautious when it comes to clothing retailers, as heavy promotions could lead to earnings disappointments in January; at 73p Debenhams looks poorly placed but we reckon ASOS and Boohoo.com - at £33.19 and 34p respectively - will do better.