WEDNESDAY MARKET CLOSE: Supermarket chains drive Footsie higher

SUPERMARKETS led a rally in London’s top-flight as it bounced back after hitting three-month lows in the previous session.
London Stock Exchange building. Picture: GettyLondon Stock Exchange building. Picture: Getty
London Stock Exchange building. Picture: Getty

The FTSE 100 index rose 76.47 points to 6,830.27 as it fought back after two days of declines, with the UK’s listed grocers among stand-out performers after Sainsbury’s reported a better-than-feared drop in sales.

Britain’s third biggest grocer suffered a sixth quarter in a row of falling like-for-like sales, but the 2.1 per cent drop beat analysts’ more pessimistic forecasts, helping the shares surge 11.3p, or 4.5 per cent.

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Rivals Tesco and Morrisons also climbed on hopes for a recovery in the under-pressure sector

The improvement for the FTSE 100 comes after the top-flight suffered its worst week since December, when it was down nearly 200 points last week, followed by further falls on Monday and Tuesday.

Tony Cross, market analyst at Trustnet Direct, said London equities started the day in rather mediocre form but sentiment was given a shot in the arm following the Wall Street open.

“A slew of better than expected corporate and economic data out of the US appears to be key to driving sentiment right now, even though many analysts are openly admitting that the market is now squaring up to the prospect of a significant correction, especially once the focus returns to the timing of US rate hikes.”

Barclays was initially lower but later recovered its poise, adding 5.6p to 267.2p, while RBS also rebounded after an early fall, climbing 2.2p to 354.8p.

Lloyds Banking Group was up 0.2p at 86.7p, while HSBC was little changed, off 0.3p at 613.4p.

The biggest risers on the FTSE 100 were Standard Chartered up 60p to 1,094p, Associated British Foods up 156p to 3,070p, Morrisons up 8.5p to 179.9p and Tesco up 9.4p to 211.4p.