Kesa Electricals triggered fresh fears over the health of the high street today after warning that Comet, the UK electricals chain, will fall into the red after a sharp drop in sales of fridges, freezers and washing machines.

Shares in Kesa, the Anglo-French electronics group, plunged by more than 9 per cent, or £14.96, to 143p as Jean Noel-Labroue, its chief executive, said that trading conditions in Europe were among the worst he had ever seen.

Comet suffered a 9.9 per cent fall in like-for-like sales over the three months to July 31 as the slowdown in the housing market hit sales of white goods, such as fridges and freezers.

“As a consequence, we now anticipate Comet Kesa will make a first-half loss,” Mr Labroue said.

He added that sales at Darty, Kesa’s French business, dropped by 3.2 per cent while revenue at the group’s fledging operation in Spain were down by between 25 per cent and 30 per cent.

“This quarter has, as anticipated, been very tough,” Mr Labroue said. “Trading conditions across all markets deteriorated, particularly in the UK, and have not changed since the period end.”

The sales figures for Kesa's first quarter were far worse than expected by the City and will raise concerns about the health of a sector that has been among one of the hardest hit by the downturn in consumer confidence.

DSG International, owner of Currys and PC World, said last week that sales of white goods such as fridges had fallen by up to 25 per cent because of the slowdown in the housing market.

Nick Bubb, analyst at Pali International, said Kesa's figures were "disappointing" and said he would be cutting his £140 million profit forecast for the full year.

Ian MacDougall, analyst at Blue Oar, added: "There’s nothing here to enthuse the market and, if trade does not improve, we will have to revisit our forecast."

In June, Kesa cautioned about declining consumer confidence and said it was deferring plans for a share buyback programme.

Kesa shares have almost halved in value over the past year and have underperformed the DJ Stoxx European retail index by 35 per cent over the same period.

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