The FTSE 100 (INDEXFTSE:UKX) has recovered some lost ground from early trading as badly received Christmas updates from retailers Tesco and Marks & Spencer dragged down the index.
The blue chip share index rose 0.10%, up 7 points at 7,756.32 by 11.48 GMT.
Tesco (LON:TSCO) shares fell 4.4% as the supermarket chain missed Christmas forecasts but still reported a record for that quarter driven by strong fresh food sales but was hampered by a fall in demand for general goods. Henry Croft of Accendo Markets said: “The negative reaction stems from UK like-for-like sales during the key period coming in at 1.9%, well shy of 2.8% consensus, weaker than even the lowest estimate of 2.0%. Tesco announced weak general merchandise sales, with strength in food unable to lift wider UK sales figures to meet estimates.”
Marks & Spencer (LON:MKS) shares dropped 6.0% as it reported a poor third quarter with falls in fresh food, clothing and international sales. Total group revenue fell 0.1% for the 13 weeks to the end of December. The company blamed trading pressure with the ongoing squeeze on consumer spending.
Just Eat (LON:JE) shares jumped 5.8% on an upgrade from Barclays to Overweight from Equal Weight.
Distribution group Bunzl (LON:BNZL) shares rose 2.9% as it said the US tax changes would have a positive effect on its performance. The company also announced the acquisition of Revco in the US and the Aggora Group in the UK.
In the mid-caps, Card Factory (LON:CARD) shares slumped by 18.3% as it warned of an expected drop in earnings for the financial year due to ongoing margin pressure. CEO Karen Hubbard said: “We anticipate that the combined impact of foreign exchange and wage inflation in our 2019 financial year will result in GBP7 million to GBP8 million of additional costs; whilst we have plans to mitigate this impact as far as possible, we recognise that against this backdrop, any Ebitda growth for the year is likely to be limited.”
On the currency markets, sterling fell 0.33% against the dollar to $1.3467 and lost 0.20% against the euro to €1.1274.