The Week Ahead: Wait for supermarkets' reports on Christmas trading

The City expects supermarkets won’t have had turkey with all the trimmings for Christmas this year.

J Sainsbury reports on festive trading come Wednesday, while WM Morrison, Tesco and Marks & Spencer all provide similar updates a day later. Analysts believe the recent crunch on pricing means the numbers won’t make for pretty reading.

Bernstein expects Sainsbury’s to reveal a 1.8 per cent drop in quarterly sales, while Tesco, the worst perfromer, is set for a 4.3 per cent dip in December trading, according to house broker Deutsche Bank.

Investors are hoping Tesco chief executive Dave Lewis can outline how he plans to turn it around. Thousands of job cuts are expected and there is speculation that Mr Lewis could kick off the sale of Tesco’s media streaming business Blinkbox.

The one exception to grim supermarket trading could be Marks & Spencer, which is expected to announce a modest 0.9 per cent rise in Christmas food sales. But analysts fear M&S’s general merchandise division will have suffered its 14th consecutive quarter of falling sales.

The first day back in the office is a quiet one, with only PMI construction figures by way of news today. A composite PMI reading and growth figures for the crucial service sector follows tomorrow.

Come Wednesday all eyes will be on the eurozone, where economists fear consumer price data could reveal the onset of deflation for the first time since the creation of the singal currency.

The recruiter Robert Walters has a trading update on Wednesday and Caledonia Investments will update investors. UK car sale figures are due.

The estate agency Countrywide has a management update on Thursday, as does the construction specialist Interserve and recruiter Hays.

The week draws to a close with statements from Betfair, Prezzo, Laird, The Restaurant Group, Tarus Group and XP Power.

In economic news, trade balance figures and both industrial and manufacturing production estimates for November are set to be released.