Gloom spreads across retail sector
The retail sector's outlook has darkened after a raft of gloomy updates across the industry.
After Tesco, which has 2,700 stores in Britain, saw billions of pounds wiped from its value after it reported dire Christmas trade, Argos-owner Home Retail Group warned it was set to slash its dividend after a poor festive season, while Mothercare reported another drop in sales, albeit at a lower rate than the summer.
Chocolatier Thorntons reiterated its recent profit warning after Christmas sales fell by more than expected, while milder weather hit sales of car maintenance products at Halfords.
Investors ditched retail stocks as the updates rolled in, with Tesco's 15% plunge on the FTSE 100 Index pulling Sainsbury's and Morrison's down 5% and 6% respectively.
The list of disappointing figures overshadowed what has broadly been a better-than-expected season for the retail sector, with Marks -amp; Spencer, Superdry owner SuperGroup, and Debenhams putting in a robust performance.
Department store House of Fraser reported a 11.1% surge in like-for-like sales in the five weeks to New Year's Eve.