Market Report: Sainsbury's set for top shelf Christmas


The battle of the supermarkets will enter a new round ahead of Christmas, and City scribblers think Sainsbury's will be having a jolly festive period while Morrisons could be decidedly lacklustre.

The grocery expert Clive Black at Shore Capital said: "If patterns currently evident continue... the Christmas winners will be Aldi and Sainsbury."

He takes his "hat off to Sainsbury's management" as the supermarket group is gaining market share and "sustaining outperformance momentum that is likely to sustain the stock's premium rating to Morrisons and Tesco".

Mr Black cites Nielsen's market share data for the four weeks to 13 October which showed Sainsbury's up 6.6 per cent and Waitrose up 7.8 per cent, but Morrisons is "still materially underperforming" with implied sales down 0.5 per cent.

Black retained his hold rating on Sainsbury's shares at 354p and reiterated his sell stance on Morrisons with a target share price of 276p. Sainsbury's shares checked in a 1.6p rise to 354.2p and Morrison's lost 0.3p to 267p.

General retailer Marks & Spencer was also on Black's shopping list, with a buy rating and a share price target at 388p. It edged up 1.6p to 389.7p.

Takeover rumours continued to circulate around the pharmaceutical industry ahead of results from AstraZeneca today. Chatter has it that since Astra – down 15.5p to 2884.5p – needs to restock its drug pipeline and is taking a long look at US drug group Amarin. But it will have competition from GlaxoSmithKline and US-based Eli Lilly.

Talking of mergers – well, failed ones – Morgan Stanley's analysts cast their eye over BAE Systems after its abortive Eads deal. They give the defence group a price target of 335p and resumed coverage with a hold rating, but added: "With the US elections fast approaching and little clarity on budgets likely in the near term, we see limited re-rating potential in BAE. However, speculation over M&A is likely to provide some support." BAE glided up 6.5p to 312.2p.

Scribes at Bernstein got radical and proposed: "Vodafone and Verizon: Is the unthinkable thinkable… who better than Vodafone to see the writing on the wall for a premium operator in a structurally declining market? The time may be right for it to relinquish its 45 per cent stake," Bernstein claims. Vodafone lost 2.55p to 172.45p.

In some quarters mining companies have been hated almost as much as bankers. There's been violence in South Africa, investor turmoil at Nat Rothschild's coal miner Bumi and the ongoing Glencore/Xstrata saga.

Now analysts reckon we should sell shares in miners who hunt for gold.

Investec's Hunter Hillcoat has published a note: "Time to take a breather (take profits)," slapping a downgrade on Africa- focused Randgold Resources and Centamin and reiterating his view on African Barrick Gold – no better than a hold. Back in the summer he said it was good to buy but since then "gold equities have performed well, appreciating by an average 28 per cent", he said. "Though we are raising our estimates and price targets, given the sector's outperformance, we now recommend that investors take profits at current levels, on the basis of buying again at lower levels."

Egypt's Centamin, which Mr Hillcoat gave a share price target of 106p, saw its shares drop 0.7p to 97.4p, and Randgold, with a share price target of 7,715p, lost 50p to 7,380p. African Barrick Gold, with a target price of 530p, gained 6.8p to 486.4p.

The FTSE 100 index was bumpy, and tried to regain some of yesterday's losses despite eurozone concerns continuing. The benchmark index was propped up by better-than-expected figures from China; manufacturing might contract at a more moderate pace in October than thought. The index edged up by 6.87 points to 5804.78.

On the mid-cap index, Argos owner Home Retail Group got punters excited with hopes of a turnaround plan. Despite analysts being less than impressed, shares managed a 1.6p gain to 105.7p.

Bloomberg noted online grocer Ocado now tops Home Retail as the most shorted retail stock according to Markit.

On AIM, video search engine blinkx travelled up 4.25p to 53.50p after broker Peel Hunt named it as one of its top media picks in its media report, retaining the buy recommendation and share target price of 101p.

Start your day with The Independent, sign up for daily news emails
footballHe started just four months ago
Nigel Farage celebrates with a pint after early local election results in the Hoy and Helmet pub in South Benfleet in Essex
peopleHe has shaped British politics 'for good or ill'
One father who couldn't get One Direction tickets for his daughters phoned in a fake bomb threat and served eight months in a federal prison
people... (and one very unlucky giraffe)
Arts and Entertainment
Sink the Pink's 2013 New Year's Eve party
musicFour of Britain's top DJs give their verdict on how to party into 2015
Arts and Entertainment
(L-R) Amanda Peet as Tina Morris, Melanie Lynskey as Michelle Pierson, Abby Ryder Fortson as Sophie Pierson, Mark Duplass as Brett Pierson and Steve Zissis as Alex Pappas in Togetherness
TV First US networks like HBO shook up drama - now it's comedy's turn
Pool with a view: the mMarina Bay Sands in Singapore
travel From Haiti and Alaska to Namibia and Iceland
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Selby Jennings: VP/SVP Credit Quant- NY- Investment Bank

Not specified: Selby Jennings: VP/SVP Credit Quant Top tier investment bank i...

Selby Jennings: Quantitative Research | Equity | New York

Not specified: Selby Jennings: Quantitative Research | Global Equity | New Yor...

Selby Jennings: SVP Model Validation

Not specified: Selby Jennings: SVP Model Validation This top tiered investment...

Selby Jennings: Oil Operations

Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...

Day In a Page

Aren’t you glad you didn’t say that? The worst wince-and-look-away quotes of the year

Aren’t you glad you didn’t say that?

The worst wince-and-look-away quotes of the year
Hollande's vanity project is on a high-speed track to the middle of nowhere

Vanity project on a high-speed track to nowhere

France’s TGV network has become mired in controversy
Sports Quiz of the Year

Sports Quiz of the Year

So, how closely were you paying attention during 2014?
Alexander Armstrong on insulting Mary Berry, his love of 'Bargain Hunt', and life as a llama farmer

Alexander Armstrong on insulting Mary Berry and his love of 'Bargain Hunt'

From Armstrong and Miller to Pointless
Sanchez helps Gunners hold on after Giroud's moment of madness

Sanchez helps Gunners hold on

Olivier Giroud's moment of madness nearly costs them
A Christmas without hope: Fears grow in Gaza that the conflict with Israel will soon reignite

Christmas without hope

Gaza fears grow that conflict with Israel will soon reignite
After 150 years, you can finally visit the grisliest museum in the country

The 'Black Museum'

After 150 years, you can finally visit Britain's grisliest museum
No ho-ho-hos with Nick Frost's badass Santa

No ho-ho-hos with Nick Frost's badass Santa

Doctor Who Christmas Special TV review
Chilly Christmas: Swimmers take festive dip for charity

Chilly Christmas

Swimmers dive into freezing British waters for charity
Veterans' hostel 'overwhelmed by kindness' for festive dinner

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Isis in Iraq: Yazidi girls killing themselves to escape rape and imprisonment by militants

'Jilan killed herself in the bathroom. She cut her wrists and hanged herself'

Yazidi girls killing themselves to escape rape and imprisonment
Ed Balls interview: 'If I think about the deficit when I'm playing the piano, it all goes wrong'

Ed Balls interview

'If I think about the deficit when I'm playing the piano, it all goes wrong'
He's behind you, dude!

US stars in UK panto

From David Hasselhoff to Jerry Hall
Grace Dent's Christmas Quiz: What are you – a festive curmudgeon or top of the tree?

Grace Dent's Christmas Quiz

What are you – a festive curmudgeon or top of the tree?
Nasa planning to build cloud cities in airships above Venus

Nasa planning to build cloud cities in airships above Venus

Planet’s surface is inhospitable to humans but 30 miles above it is almost perfect