Good morning from London, where the FTSE 100 is down so far – dragged down by a near 5% fall in Sainsbury’s share price.
A trading statement from them this morning revealed that food sales remained strong in the fourth quarter of 2023 but general merchandise and clothing sales fell back, though they are maintaining full-year profit guidance of between £670-£700 million.
Richard Hunter at Interactive Investor says strong food sales are not “being mirrored in other parts of the group… adding that consumers have become increasingly selective in non-essential items which, coupled with other competitors specifically concentrated in this space, has left Sainsbury trailing.”
That resilience in food spending very much in evidence over at high street bakery chain Greggs, whose shares are up nearly 10% this morning. An update from them this morning reveals that cash generation is well ahead of expectations with net cash of £195m at year-end vs a £130m expectation from analysts.
Seasonal lines, including the Festive Bake, Chocolate Orange Muffin and Christmas Lunch Baguette performed well as did pizza, which is a key component of the company’s push to sell more products during the traditionally quieter evening segment of the day.
Overall though the markets still getting back up to speed, with the next big bit of news expected to be fresh inflation figures from the US tomorrow afternoon UK.