Sainsbury's quarterly boost, Legal & General dividend surprises

Stocks to watch

Sainsbury's posted positive sales growth in the fourth quarter, the first quarterly sales growth in more than two years, good news it would expect to boost its shares and its bid to acquire Home Retail Group. With transactions and volumes both heading in the right direction, the supermarket group grew total sales 1.2% and like-for-like sales 0.1% excluding fuel.

Legal & General boosted its full year dividend by a fifth to 13.4p per share and committed to more progressive increases, against market expectations. The dividend had already doubled in size since 2010, with UBS earlier forecasting that growth in the distributions would have to slow to 6% a year between 2016 and 2019.

Online grocery home delivery firm Ocado said group gross sales rose 15.3% to £312.4m in the quarter to 21 February as average weekly orders climbed 16.9% to 214,000 but the average order size fell. Chief executive Tim Steiner said post period the company shipped more than 250,000 orders in a single week for the first time.

Newspaper round-up

The Bank of Japan has downgraded its view of the economy but held interest rates at minus 0.1 per cent, reflecting public confusion over January’s unprecedented move to take rates into negative territory. The BoJ, like peers such as the European Central Bank, is in largely uncharted territory and negative interest rates have had several unintended consequences — not least prompting trade unions to ditch wage demands in the expectation of weaker corporate profitability. – Financial Times

Government must lean on banks to keep funding troubled North Sea oil explorers or risk a $250bn hit to the UK economy, Sir Ian Wood has warned. The highly influential industry veteran said a number of oil companies could go under as banks pull back on lending to the heavily indebted sector, which is already shedding around 200 jobs a day. But the “real danger” to the UK economy could come from a loss of investor confidence, which could result in billions of barrels in oil reserves left untapped. – Telegraph

Almost 300 institutional investors in Volkswagen have filed a multi-billion dollar suit against the carmaker for what they claim were breaches of its stock market duty in the emissions cheating scandal. The lawsuit, for damages of €3.3bn ($3.6bn), was filed at a regional court in Braunschweig in VW’s home state of Lower Saxony on Monday and is being brought by 278 investors from all over the world, including German insurers and US pension fund Calpers. – Guardian

Shares in the London Stock Exchange hit a record high yesterday as expectations grew that it will reveal the details of an agreed merger with Deutsche Börse within days, valuing the combined group at more than £20 billion. The LSE’s share price ended trading more than 1 per cent higher at £29, its highest since the exchange became a public company in 2000. – The Times

US close

Markets in the US ended on a mixed note on Monday, though they appeared to brush off a drop in oil prices as investors looked towards the US Federal Reserve meeting later in the week.

The Nasdaq Composite and Dow Jones Industrial Average both managed to reverse opening losses to eke out gains, by 0.04% to 4,750.29 and 0.09% to 17,229 respectively.

Boeing was the big leader on the Dow gaining 1.37%, while the Nasdaq was led by rises in Gilead Sciences, up 1.39%; Amazon, up 0.66%; and Starbucks, up 1.84%.

Trade volumes were looking to be at their lowest in 2016 so far, sitting just above six billion at close.