London’s FTSE 100 was down 0.8% at 7,026.84 in afternoon trade on Wednesday.
Tesco fell after saying it expects current year profits to be at the lower end of guidance as “significant uncertainties” persisted during the cost-of-living crisis. The company said it expects full-year retail adjusted operating profit of between £2.4bn and £2.5bn as it said profits fell 65% to £413m in the six months to August 27.
Ocado and Sainsbury’s also lost ground.
Richard Hunter, head of markets at Interactive Investor, said: “These are tough times for many, and Tesco is not alone in feeling the resultant strain.
“As the pressure increases on an increasingly cost-conscious and cash-strapped consumer, the notoriously competitive sector in which Tesco operates has moved up another gear.
“There has also been some normalisation in terms of shopping habits, with a general tendency for customers to return to stores. That being said, the momentum which the pandemic provided has resulted in an increase of over 50% for online sales compared to the pre-lockdowns period. Alongside a variety of offerings for the customer ranging from Click & Collect to convenience stores to the more popular online and store visits, the group is offering something for everyone and with a sharp focus on the customer budget.”
Retailers more generally were under pressure, with Next, Frasers Group and JD Sports all lower.
FTSE 100 – Risers
Haleon (HLN) 277.90p 1.35%
Shell (SHEL) 2,365.00p 1.15%
BAE Systems (BA.) 822.40p 0.96%
Harbour Energy (HBR) 455.10p 0.93%
BP (BP.) 458.60p 0.90%
Imperial Brands (IMB) 1,896.50p 0.74%
Pearson (PSON) 907.60p 0.69%
Experian (EXPN) 2,771.00p 0.65%
Relx plc (REL) 2,283.00p 0.57%
Diageo (DGE) 3,802.50p 0.29%
FTSE 100 – Fallers
Ocado Group (OCDO) 470.90p -7.12%
Next (NXT) 4,786.00p -4.85%
Melrose Industries (MRO) 102.80p -4.55%
Airtel Africa (AAF) 132.40p -4.20%
Sainsbury (J) (SBRY) 173.10p -4.15%
Smurfit Kappa Group (CDI) (SKG) 2,600.00p -3.70%
Frasers Group (FRAS) 663.50p -3.63%
JD Sports Fashion (JD.) 104.15p -3.52%
Tesco (TSCO) 202.70p -3.48%
Mondi (MNDI) 1,371.50p -3.21%
