Tuesday, 6th March: It’s a good day for Sainsbury’s staff, well for the ones that get to stay anyway. The second-largest supermarket in Britain announced they would be increasing the base rate of pay for staff in-store by 15% from £8.00 to £9.20. However, they will also be reducing the number of in-store roles quite drastically, from 22 positions to five, and remove colleague bonuses and paid breaks. Sainsbury’s shares were down around 3.0% in the afternoon.
Consumers however, have once again demonstrated their preference over spending on food opposed to non-food items, as new data released on Tuesday showed a 4.0% increase in the sale of food items, and a 0.5% decrease in the sale of non-food items, in the three months to February compared to the same period last year. The further reduction on the amount spent on non-essential items proves that shoppers are still struggling to come to terms with the aftermath of Brexit, although some predict that the pressures will slowly but surely ease off this year, and wages will begin to overtake inflation.
On the blue-chip index, Smurfit Kappa and Just Eat were on complete opposite ends of the spectrum. At around 15:30 (GMT) Smurfit Kappa was up almost 21% after they rejected a bid approach from U.S rival International Paper Company. As a result, other paper and packaging companies in the FTSE 100 were also up, including Mondi and DS Smith, both up more than 3.0% and 5.0% respectively during afternoon trading. Just Eat however had fallen c.12% at the open after releasing 2017 earnings, which demonstrated weaker earnings forecast than expected, including a profit outlook which is c.23% below expectations, as well as higher than expected spending of £50.0 million.
At the end of the day, the FTSE 100 managed to close 0.43% higher at 7146, placing them back to where they were in April 2017 and almost 3.0% lower than March 2017.