Recession or not, people can't walk around naked ... especially not in the United Kingdom. (Iceland in summer? Fair game.) Marks & Spencer Group Plc (London: MKS:UK), the largest clothing retailer in the country, just sustained its smallest drop in sales in nearly two years thanks to some savvy deals (offered to consumers) and warm weather. After making their dollars pounds stretch for so long, shoppers were finally ready for a bit of style.

Revenue declined a modest 1.4% for the year so far, much better than the 2.5% average estimate offered by 16 analysts. This was good enough to push M&S shares up 4%. If all goes well, same store sales may start to increase soon, which means that a full recovery will be right around the corner. Same store sales have fallen for the past seven quarters, and company cut its dividend for the first time in almost a decade.

The discounts that helped lead to the recent M&S sales performance are responsible for 18% of the company's food sales (which are down 0.5% on for same store) – much better than the 2.4% estimate. General merchandise fell only 2.4%, beating the 3.5% projection handily.

If the markets are concerned about the U.S. consumer starting to weaken, we're now seeing global consumers curb their retail spending as well.

Bloomberg reports that Marks & Spencer Group Plc, the U.K.'s largest clothing retailer, dropped severely in London trading this morning off the back of a surprisingly weak holiday sales period.

Bloomberg reported, "Marks and Spencer shares slid as much as 21 percent after Marks said today that revenue fell 2.2 percent at stores open at least a year in the fiscal third quarter ended Dec. 29, the first same-store sales drop in 2 1/2 years. The median estimate of eight analysts surveyed by Bloomberg was for growth of 1.1 percent."

Oof. That's almost a -3.5% surprise to the downside.

"If you are an average person on an average salary in the U.K., you are having a very tough time,'' Chief Executive Officer Stuart Rose said in an interview on Sky television. "About the only thing that isn't going up is the cost of clothing. People are being squeezed.''

Zack Miller the managing editor of IsraelNewsletter.com and a former equity analyst for a leading multinational hedge fund.