Tesco survive tough trading

Tesco became the latest supermarket to issue Christmas trading results. Graham Spooner, investment adviser at retail stockbroker, The Share Centre, comments on what Tesco's increase of just 2.5% means for investors in like-for-like sales: "Although today's results show Tesco's worst sales increase since the early 1990s, Tesco's figures are in line with expectations and are good news in such a tough retail environment. Market share in non-food products is picking up as customers seek value and choose Tesco over specialist outlets. This underlines the strength of the company and is positive for future growth.

"The big four supermarkets are constantly snapping at each others heels over market share and competing over discounts which is good for the customer. We saw encouraging results from Sainsburys last week, which are continuing to build momentum. However, Tesco has one of the largest market shares in the sector and this remains relatively consistent.

"Considering the volatility on the high street at present, we are advising Tesco shareholders to hold. However, those looking to buy should think about gradually investing their money to help smooth out market fluctuations. Shares aren't expected to increase dramatically in the short term but long term potential remains. Their cheap food and cut-price clothing is likely to attract UK consumers watching their pennies at present. The store's international sales are up and there is potential for Tescos to further expand abroad."