Shares in Marks and Spencer were under pressure despite the retailer posting its third consecutive rise in quarterly sales.
Group sales in the 13 weeks to 3 July rose 4.4%, helping new chief executive Marc Bolland get off to a solid start.
Mr Bolland said: "We have continued to grow market share across all part of the business."
However, investors were concerned after M&S said future trading could be impacted by a dent consumer confidence.
Like-for-like sales at the UK stores open at least a year rose 3.6%, boosted by a strong performance in clothing.
While this rise was at the top end of analysts' forecasts, it was down from a 5.1% rise in the previous quarter.
Sales in the food unit rose 2.9%. But international sales grew by just 0.9%, with the company blaming the adverse effect of currency conversions and difficult trading in some markets.
But M&S also warned that future trading could be challenging, sending the shares down almost 4% earlier.
"We have made a good start to the financial year, but following the recent budget and the actions proposed to reduce the national deficit, including the increase in VAT, we are cautious about the outlook for consumer confidence and spending and continue to manage the business accordingly."