Tesco dips on sales concerns

The City remained unconvinced on Tesco's £1 billion turnaround plan today as the supermarket giant posted fresh sales declines in the UK and across all its overseas markets.

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Tesco's assurances over its full-year figures failed to boost shares.

The City remained unconvinced on Tesco's £1 billion turnaround plan today as the supermarket giant posted fresh sales declines in the UK and across all its overseas markets.

Concern over ongoing tough trading wiped out initial gains, despite Tesco confirming it remains on track with full-year forecasts.

The wider FTSE 100 Index fell to its lowest level for nearly two months, down another 22.5 points to 6510, as sentiment continued to be hit by fears over US plans for the tapering of bond purchases.

Today's falls come after London's top tier lost more than 100 points in the first two sessions of the week.

There were also further falls across Europe after c onfirmation that the eurozone's recovery weakened with slower growth of 0.1% in the last quarter, while the Dow Jones Industrial Average on Wall Street was struggling to make headway in early trading.

UK figures also revealed weaker-than-expected growth in the UK services sector.

The reading of 60 in the closely-watched Markit/CIPS purchasing managers' index was well ahead of the 50 no-change level but down on the previous month's 16-year record of 62.5.

Tesco was near the top of the FTSE 100 risers board for a while, but later stood 1.6p lower at 340p amid a mixed reaction to its third quarter figures.

Chief executive Philip Clarke blamed a weaker grocery market for the 1 .5% fall in UK like-for-like sales, a figure which was in line with City forecasts. Underlying sales were also lower in its nine international markets, with Ireland down by as much as 8.1% on a year ago.

Shore Capital analyst Clive Black kept his buy rating on the stock and urged Mr Clarke to stick to his guns on the company's £1 billion turnaround programme.

Retail and accountancy software group Sage topped the risers board in London with a gain of 7%, or 25.5p to 372.9p. It impressed the City with a small rise in full-year underlying profits and said it remained on track to achieve its 6% organic revenue growth target for 2015.

Asia-focused bank Standard Chartered led the fallers after it said it continued to face difficult trading conditions, with income this year likely to be flat on the performance in 2012.

The London headquartered bank, which declined 92.5p to 1338.5p, has been impacted by the weakness of local currencies against the US dollar.

Other fallers included Nurofen and Calgon owner Reckitt Benckiser after UBS cut its rating on the stock from buy to sell. Shares have enjoyed a strong run since October but were down 49p to 4816p today.

The biggest FTSE 100 risers were Sage Group ahead 25.5p to 372.9p, Tullow Oil up 22p to 876p, Melrose Industries 7.1p higher at 287.4p and Rio Tinto 62.5p stronger at 3262.5p.

The biggest FTSE 100 fallers were Standard Chartered down 92.5p to 1338.5p, Aberdeen Asset Management off 22.3p to 461.4p, Pearson 37p lower at 1295p and Severn Trent 40p weaker at 1663p.