Shares in Sainsbury’s and Morrisons slid this week amid analyst concerns over lacklustre Christmas trading.
Ahead of a Morrisons trading update on Monday (7 January) and Sainsbury’s third-quarter results on Wednesday, analysts predicted Morrisons would report a 2.8% drop in like-for-like sales, while Sainsbury’s would report growth of 0.9%.
“We expect Morrisons to kick off the January trading season in a weak manner,” Jefferies analyst James Grzinic said in a note. The hard discounters, on the other hand, were expected to have gained market share over Christmas.
Oriel analyst Jonathan Pritchard warned that Sainsbury’s was likely to have lost ground to a resurgent Tesco, which is due to update on trading on Thursday.
“It appears the established podium line-up (Waitrose, Aldi and Lidl) stretched their lead, but the biggest slowdown may have come at Sainsbury’s,” he said.
Last year, Sainsbury’s reported a 2.1% increase in like-for-like sales, excluding fuel, for the 14 weeks to 7 January 2012. Morrisons reported like-for-like growth of 0.7% for the six weeks to 1 January 2012.