Supermarkets, motoring and cakes

The FTSE 100 continued yesterday afternoon's revival buoyed by the oil price recovery and a positive overnight session on Wall Street.

“Supermarket giant Tesco returned to profit after going back to basics but its outlook disappointed investors as the growing spectre posed by discounters Aldi and Lidl remains,” says AJ Bell Investment Director Russ Mould.

“Tesco saw its first quarterly sales growth for three years with UK like-for-like sales up 0.9% but further sell-offs, including its restaurant chain Giraffe, the Harris & Hoole coffee shops and the Dobbies garden centres, seem inevitable as it focuses on its main supermarket business.

“Halfords topped the FTSE 250 board as like-for-like revenues rose by 2.6% in the 11 weeks to the beginning of April. Motoring sales grew against tough comparatives due to an increase in sales of dashboard cams. ‘Crash for cash’ has been a headache for insurers for some time and motorists are clearly becoming increasingly concerned that they need evidence of what happened in the event of an accident.

“Mr Kipling cake maker Premier Foods’ shares plunged after McCormick decided it would not make an offer having completed due diligence. It has decided it would not be able to propose a price that would be recommended by the Premier Foods' board and also give appropriate returns for McCormick’s shareholders.”

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