The retail world was awash with the usual summer rumours yesterday, but perhaps the market should not be so sceptical this time round.

Woolworths, the troubled high street retailer, started the session on the back foot after negative comments from HSBC and renewed speculation over its debt covenants. The broker cut its target price to 6.1p from 10.3p after the company’s decision not to sell its 2Entertain unit and significant deterioration in trading at Woolies.

However, as the day went on, talk gathered pace that Ardeshir Naghshineh, an Iranian property tycoon who already has a stake in the retailer, was trying to put together a bid consortium. Lo and behold, after the market closed the company revealed that Mr Naghshineh, who has a fortune estimated at £500 million, had raised his stake to 9.68 per cent. Past speculation suggested that Mr Naghshineh, who founded Targetfollow, one of the UK’s largest privately owned investor-developers, was interested in buying property leases from Woolworths. The shares closed down 0.02p at 5.96p.

Interior Services Group continued to defy the gloom, rising 20½p to 171p, after wining a construction management contract to fit out a new low energy data centre in the North East of England worth £75 million. The deal comes hot on the heals of an £80 million contract to build the 2012 Olympic velodrome, a £50 million office fit-out for KPMG and a £50 million education project. Evolution up-graded the stock to “buy”.

Johnson Service Group ticked up ½p to 22½p after it unveiled plans to raise up to £10 million in an open offer and appointed John Talbot as its executive chairman. The workwear-to-dry-cleaning group also said that it expected to start paying interim and final dividends in 2009.

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