While all eyes recently have been on the impact on beer sales of the smoking ban in England, brewers have had to cope with the more immediate problem of the soggy weather.

In a trading update today, Scottish & Newcastle, Britain's biggest brewer, estimates that the wider beer market fell by 5 per cent in the first half of the year.

While the comparison with last year's World Cup bonanza was one factor, the torrential rain has accentuated an already tough market.

The good news for S&N investors is that the purveyor of Kronenbourg 1664 and John Smith's won market share, although it must be assumed that it still suffered a decline.

Despite the smoking ban, the group reckons that the beer market will be "broadly level" in the second half as comparatives improve, and again it expects to beat the competition.

The big cost-cutting and reorganisation of the past couple of years has helped S&N to maintain its pre-eminent position in the tough UK market, and another £10 million of savings will flow through in the second half.

Elsewhere, France remains a challenge, with a strong performance from its top brands being offset by an "extremely challenging" wholesaling climate.

Baltic Beverages Holding, its joint venture with Carlsberg that takes in Russia, had another storming period, although it faces tougher comparatives in the second half.

The overall tone of S&N's trading update is rather muted, although with the various negatives and positives cancelling each other out the group still expects to meet current full-year profit forecasts.

The shares, off 2.5p to 630p today, have run up from 516p since March, buoyed by persistent bid speculation.

Such conjecture looks misplaced, and with no immediate prospect of a takeover, the shares are no more than a "hold".

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