THE TIPSTER

 
Philip Salter
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SAINSBURY’S, the third largest supermarket by market share after Tesco and Asda, is expecting a rise in pre-tax profit by eight per cent to £659m when it reports on Wednesday. The top three chains have all dropped market share since April 2010, which suggests shoppers may be looking for cheaper alternatives such as Aldi and Lidl, who saw an increase in market share. New promotions such as “feed your family for £50” in the week could well be a step in the right direction given the current market environment. Capital CFDs quotes 349.0p- 349.7p for Sainsbury’s.

Although oil prices slipped dramatically late last week, there can be few surprises that the dip was short lived. Bumper US payroll figures played a part, while the fundamentals for rising prices remain largely in tact. There are some key economic readings due out of China later in the week so further wobbles can’t be ruled out entirely, but there is little reason to believe that the upward trend has been broken. Current IG Markets price on US light crude June contract is $99.52-$99.58.

CFD traders were taking advantage of the pop up in Kesa Electricals on Monday to 143p to sell short. The shares gapped higher on market talk that private equity group PAI Partners is considering a bid for the company. The jump in the share price failed to close the gap to 150p from 19 January though, and with their ongoing problems, traders were happy to sell at these levels. Spread Co quotes 139.5p-140p for Kesa Electricals.

We have seen the biggest fall in commodities in over two years, and as a result wheat has hiked on concerns of shortage of supplies. Weather conditions are also playing a big factor as droughts are occurring globally and pushing prices higher. If the dollar continues to weaken, this could show further support for grain prices. Capital CFDs quotes July Wheat at 776-777.

With ITV stating it feels the market has already factored in worse than expected figures ahead of Thursdays quarterly figures, we could see some market movements. WorldSpreads offers a spread of 74.2p-74.4p.