Market Report: Has Tesco hit bottom? Some think so

Tesco is still swamped by news about its investigation into its £250m black hole but punters put it on their shopping list yesterday as some hoped the supermarket giant had hit the bottom.

The shares are down more than 20 per cent in the past month since the revelations emerged, but its delayed first-half results due on Thursday gave investors a reason to think things might start to improve. The hope is that the chairman, Sir Richard Broadbent, and new chief executive Dave Lewis will sort out the mess. The blame game at the moment points to the regime under former chief executive Phil Clarke, and it even emerged that he has been dropped as one of David Cameron’s business advisers.

Things aren’t usually that simple but Tesco shares spent most of the day at the top of the table, only to slip a little toward the end of the afternoon session, finishing up 4.75p at 1,793p.

Hospitality giant Intercontinental Hotels Group took top spot ahead of its third-quarter figures due today, up 93p at 2,249p.

Traders remained largely unconvinced of any good news for the markets despite Asian shares making a recovery. Investors in the Square Mile are still concerned about slowing growth, a re-emerging eurozone crisis and the spread of Ebola.

Friday’s rally fizzled out and the FTSE 100 tumbled 43.22 points to 6,267.07 – it is down more than 5 per cent this month after hitting a 15-month low last week.

Oil shares were out of favour again as the oil price slump lingered: oil and gas giant BG Group was bottom of the blue-chip table, down 40.5p to 1,024.5p, and oil services engineer Petrofac slipped 30p to 1,030p when a trio of analysts cut their price target for the group.

Tech stocks were on the sell list after disappointing updates from SAP and IBM. Smartphone microchip designer Arm Holdings lost 23.5p to 851.5p ahead of Apple’s results.

Small-cap explorer President Energy spurted nearly 80 per cent – up 13p to 30p – on news that it found oil in Paraguay.

On AIM, Tanzania-based Shanta Gold said its third-quarter production was up 4 per cent. It gained 0.5p to 9.38p.