Spreadex Market Update
Slightly stronger market
So, without trying to draw as much meaning from ancillary figures as possible, the bottom line here is the good news continues for a group that has not only consistently outperformed its peers but the broader market, too. Admittedly, though, when Tesco (TSCO.L) posted its profit warning in January, the sector looked troubled in a material way; if the biggest operator in the market was struggling, it can be reasonably extrapolated that its competitors will face similar challenging headwinds. But today’s figures stand to dispute that rationale for the industry as a whole to at least some degree.
 
The news today, then, could prove as worrying for Tesco as it is promising for Morrison’s. The problem for Tesco is that the earlier profit warning looks to be more localised than its board advised, with Morrison’s increasing revenue and profits, supplemented by an impressive record number of new customers added for the period. In summary, the long Morrison’s, short Tesco trade today continues to offer its appeal. But the extent to which the market has already priced in this disparity cannot be ignored.
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