Penneys' underlying sales to fall in second half on weaker European demand

Associated British Foods warns it expects consumer environment 'to remain uncertain'

Penneys/Primark also forecast strong sales growth in the United States in the second half.

Penneys owner Associated British Foods said underlying sales at its clothing business are expected to fall about 2% in its second half, as improved trading in Britain and Ireland is offset by weaker consumer demand across continental Europe.

The group, which also owns major grocery, sugar, agriculture and ingredients businesses, cautioned that it expected the consumer environment "to remain uncertain", sending its shares down 10%.