FTSE 100 edges up as retailers in spotlight

After hitting a four-year high during trading yesterday, the FTSE 100 continued its momentum this morning and was trading modestly up, with supermarket giant Tesco an early leader.

This morning the supermarket posted its strongest UK growth over three years, as it said like for like UK sales were up by 1.8 per cent over the Christmas period, sending its shares up 2.3 per cent in early deals.

Analyst Philip Dorgan at Panmure Gordon said this morning: "Tesco has reported the strongest Christmas sales growth of the Big Four. This sets up very nicely what we believe will be a year of significant strategic change."

Other blue chip risers included outsourcing firm Bunzl, rising 3.15 per cent as it completed three further acquisitions in South America and the US, and utility firm Severn Trent.

On the FTSE All-Share building products giant SIG was up almost six per cent, despite warning that construction markets would remain challenging in the year ahead.

Retailer Marks & Spencer took a hit this morning as its shares fell 4.58 per cent. Its Christmas trading figures, which were leaked after trading hours yesterday, showed that like for like sales at UK stores fell 1.8 per cent in the 13 weeks to 29 December.

Clive Black at Shore Capital said: "There is no doubt that this statement is disappointing from a trading perspective, particularly in general merchandising in the UK."

Intertek was also a blue chip loser, shedding 1.3 per cent. Yesterday it announced it had snapped up a UK vehicle engine testing business for £5.5m.

UK banking shares had a mainly positive morning. HSBC was up 0.34 per cent, RBS ticked up 2.21 per cent, Lloyds Banking Group added three per cent while Barclays was the only faller, losing 0.29 per cent.