Sales slump hits supermarket shares

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The FINANCIAL — Supermarkets Tesco and Sainsbury's were among the blue-chip fallers amid further evidence of subdued retail demand, according to London Stock Exchange .

 

In an otherwise positive session for the wider London market, Tesco slipped 1.9p to 389p and Sainsbury's dropped 0.3p to 298.5p after smaller rival Morrisons revealed lacklustre underlying sales growth of 0.7%.

The pair will report figures later in the week, with Tesco expected to post one of its weakest Christmas trading periods in several years. Morrisons shares were flat at 311.5p.

Elsewhere in London, stronger banking, property and mining stocks helped London's FTSE 100 Index climb 14.7 points to 5664.3.

The main event for traders is likely to be a press conference involving German chancellor Angela Merkel and French president Nicolas Sarkozy, when the pair will discuss steps to boost growth in eurozone countries ahead of an EU summit on January 30.

Risers in London included Lloyds Banking Group, which added 0.3p to 27.4p, and HSBC after a gain of 4.3p to 502.5p.

In the FTSE 250 Index, shares in JD Sports Fashion jumped 6% after it confirmed it was close to a deal to buy certain assets of ailing retailer Blacks Leisure.

The stock rose 39.5p to 699.5p, although retail analyst Freddie George of Seymour Pierce stockbrokers questioned the merits of a deal that will leave the company with an estate of 800 UK stores.

 

 

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