Both retailers will update the City on Christmas trading later this week and although Sainsbury's is expected to meet City forecasts of 3.6% like-for-like growth for the 12 weeks to 29 December, it will miss more stretching internal figures, The Times reported.
“The alarm bells are ringing,” Gregg Lawless, retail analyst for Blue Oar Securities told the paper. “Our sources suggest that Sainsbury's has underperformed the market this Christmas and has missed internal profit targets.”
“Morrisons was the winner,” he added. “We believe that Morrisons is winning customers from Sainsbury's, particularly in the south.”
Meanwhile, analysts have predicted that M&S could report as much as a 2% dip in like-for-like sales growth for the 13 weeks to 29 December.
“The market expects the store revamp to drive growth but the vibe was that food and clothing were disappointing before Christmas,” Nick Bubb, an analyst at Pali International told the Independent.