Analysts believe that HMV’s music stores could reveal a pick-up in trade on Thursday after strong figures from Game Group last week.

The firm, which also owns the bookseller Waterstone’s, is expected to announce that underlying sales were up by 0.1 per cent in the three months to April, compared with a 2 per cent decline in the nine weeks to March 10.

“We believe there may be potential upside to our like-for-like and margin forecasts given current trading momentum seen at Game Group and margin potential at Waterstone’s,” analysts at Lehman Brothers said in a note.

Trading at Waterstone’s is thought to have worsened, with underlying sales down by 8.7 per cent, compared with a 6.1 per cent decline in the nine weeks to March 10.

Almost £100 million was wiped off HMV’s market value last month when the retailer issued its second profit warning in three months. The company said that annual profits would miss forecasts, amid worsening trading conditions at its overseas operations and its Waterstone’s chain. The City is hoping for signs that the turnaround strategy of Simon Fox, the new chief executive, is bearing fruit. He is expected to reveal the location of two trial new-format stores.

The new locations are intended to have juice bars and gaming areas and HMV is trying to build a social networking internet site for enthusiasts of music, film and games. It has also signed music and film deals with Universal Music and Twentieth Century Fox and has signed a deal with 3, the mobile phone operator, to sell music to its customers.

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