Shares in Wm Morrison Supermarkets PLC (LON:MRW) jumped as the clock struck midday, with "a mad story" doing the rounds that US giant Amazon Inc (NASDAQ:AMZN) is eyeing up a potential bid for the UK's fourth-largest grocer.
"Looks to me like wild speculation, but stranger things I guess," said Bryce Elder of FT Alphaville, where the rumour was first reported.
Morrisons shares immediately popped on the news, climbing 2.3% to 228.6p in early afternoon trading.
Aldi and Lidl continue to gain
They had been lower for most of the day after industry data showed that the 'Big Four' UK supermarkets continued to lose market share to German discounters Aldi and Lidl over the past 12 weeks.
Asda, which has agreed to be taken over by J Sainsbury plc (LON:SBRY), was the only supermarket among the so-called ‘Big Four’ to maintain market share in the period, Kantar Worldpanel revealed.
Its share of the UK grocery market was 15% and sales rose 1.5%. Tesco PLC’s (LON:TSCO) market share fell to 27.6% from 28.2% the same period a year ago and sales dropped 0.1%. Sainsbury’s market share dropped to 16.0% from 16.4% last year and sales declined 0.2%. Morrisons delivered a 0.5% rise in sales but its market share fell to 10.5% from 10.6% the previous year. Aldi sales gained 12.2% and its market share rose to 7.6% from 6.9% while Lidl’s sales were up 11.2% and its market share increased to 5.6% from 5.1%.
READ: Morrisons, Tesco, Sainsbury's and Asda change tactics as Aldi and Lidl disrupt market
Competition from Aldi and Lidl has prompted the Big Four supermarkets to implement measures to improve their sales performance and reduce costs with Tesco and Morrisons expanding into wholesale supply and Sainsbury’s agreeing to buy Asda.
Fraser McKevitt, head of retail and consumer insight at Kantar, said supermarkets sales were also dented by the cooler weather.
“Over the summer shoppers upped their weekly trips to the grocers as they took advantage of the hot weather, but with the mercury dropping the number of trips has tailed off – again contributing to waning market growth,” McKevitt said.
“Black Friday – which fell on 23 November – saw footfall to the entertainment, toy and electrical retailers nearly double, but had little impact on the supermarkets.”
McKevitt said while the majority of households took part in Black Friday, e-commerce trumped bricks-and-mortar shopping for non-fast moving consumer goods products like packaged foods and beverages.
Christmas spending record
Looking ahead to the Christmas trading period, McKevitt said spending is expected to break records despite the market slowdown over the latest 12-week period.
"The last time Christmas Day fell on a Tuesday was in 2012 and the Saturday before was the busiest shopping day of the year," he said.
"We expect the same trend to hold true this year, with Saturday 22 December pulling in the last-minute Christmas crowds."
--Updates for Morrisons-Amazon speculation--