Sector movers: Sainsbury leads grocery stocks higher

2nd Dec 2014 14:28

Food and drug retailers were the best-performing stocks on Tuesday, with supermarkets leading the charge.The wider retail sector has performed well over recent sessions on the back of the recent plunge in oil prices, with shops hoping that less pressure on customers' wallets will lead to a pick-up in consumer spending ahead of the important holiday season.Sainsbury's shares were up 4.2% at 241.6p, helped by comments from Citigroup analyst Pradeep Pratti who reiterated his 'buy' rating and 300p target price for the stock.After last week's Citi Retail Day, the broker spoke to Sainsbury chief financial officer John Rogers about the grocer's recent £150m price investment.According to Pratti, Rogers said that Sainsbury's "price position versus both Morrison and Tesco has never been better". The executive said it would be more costly for its competitors to match Sainsbury on its latest reductions.Rival supermarket Tesco rose 1.4% after the news that new boss Dave Lewis has taken over the day-to-day running of the company and shaken up the management team.As part of this shake-up, Tesco has parted company with a number of the eight senior managers who were suspended in the wake of the recent accounting scandal.Analysts at Shore Capital said in a note on Tuesday: "We are comfortable that there is more downside protection in Tesco's shares these days with Mr. Lewis' hand on the tiller".Competitor Morrisons was also trading higher, up 3.3% in London.Convenience and newsagent store group McColl's Retail was also on the rise, up over 1% in afternoon trade as the stock erased earlier losses after its fourth-quarter statement.The company reported a 1% slip in like-for-like sales during the last three months of its financial year, but said that overall results for 2014 should be "broadly in line with expectations".Chief executive James Lancaster said the "consumer outlook remains challenging", so the recent drop in oil prices will hopefully provide some respite.Top performing sectors so far todayFood & Drug Retailers 2,744.72 +2.42%Oil & Gas Producers 7,294.55 +2.23%Oil Equipment, Services & Distribution 17,924.63 +1.76%Banks 4,518.03 +1.62%General Industrials 3,857.01 +1.62%Bottom performing sectors so far todayTechnology Hardware & Equipment 1,093.42 -1.61%Industrial Metals & Mining 1,436.99 -1.48%Industrial Transportation 2,655.34 -1.27%Chemicals 10,841.08 -0.52%Food Producers & Processors 8,258.41 -0.26%