Tate share slide hits FTSE with sugar slump

British supermarket shares were today unruffled by the UK's Competition Commission (CC) progress report on its inquiry into the £95bn (€145bn) grocery sector.

While it is still early days in the investigation, analysts noted the CC said it would not look to punish Tesco for its commercial success.

The wider market was broadly flat, down 7.2 points at 6211.2 by mid-morning, after a hammering for Tate & Lyle shares.

Tate shares were down 15%, or 112p, to 608p, after it said weaker-than-expected sales of sugar substitute Splenda would leave profits below market hopes.

The warning impacted other food producers, with Unilever down 31p at 1368p, British Sugar owner Associated British Foods off 4.5p at 814.5p and Cadbury Schweppes down 5.5p at 552.5p.

Building materials group Wolseley led the risers board, up 2% or 24p to 1373p, as investors returned to the stock after the disappointment of yesterday’s trading update.

Marks & Spencer was also up 8p to 678.5p, following the announcement of plans to tackle its final salary scheme pension deficit.

It will find the extra £704m (€1.1bn) by contributing £500m (€762.9m) to the scheme through the release of its properties to a newly-established partnership with the pension scheme.

Among other retailers, supermarkets held firm with Tesco 0.75p higher at 414.5p, Morrisons up 1.5p at 285.25p and Sainsbury’s 5.75p higher at 440.25p.

In the second tier, WH Smith shares were 5% higher, up 19.5p to 393.5p, after it said it was on course to meet profits expectations. Like-for-like sales were 6% lower on the high street, but the retailer made up the difference with an increased focus on margins.

Logica CMG moved in the opposite direction, down 6%, or 10.25p, to 172.5p, after it said the growth rate in its IT services branch was seen at below 5%, under the guidance percentage from analysts.