UK 03:25 Monday, 5 October 2026
Breaking news and expert analysis on fast-moving AIM and LSE listed shares
Disclosure: I own shares in one or more of the stocks mentioned. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
Hello Share Surfers. The old Footsie fell 2.5% on a day which began rather well. Why? Well, according to the media, the European Central Bank 'failed to deliver on market expectations for an increase in monthly asset purchases.’
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Comments
David Russell
Sorry Malc but I think supermarket will be hit hard this Christmas but most you said I agree with.:)
I work in a supermarket (not Tesco) and think we will see more bad news than good because most have lost the plot and forgot they are a shop that sells for a profit. We have so many stores that they compete against their self’s as well as other supermarkets and discounters. Then they am reducing prices and bringing out so called deals at the cost of the business. They are getting more shop lifters and push outs every week most speak very bad English and care very little about UK Law. The stock is being damaged in transit before it reaches store and that reduces or takes away the profit on every case. The industry will have to change and if not we will see the end of some of the so called big names. :(
wildrides
Hope your not in Toms tip “Teathers” as it has been suspended today . Hero to ZERO . Still cant expect much from a Drummond Brothers enterprise . Remember MDC .
LGO….LGO …LGOoooooooooOOOOO.
Malcolm Stacey
Thanks David. It’s great to have news from the shop floor, literally in your case. Didn’t know that stuff and I do now.
Malcolm Stacey
Did not try this one, Wilders. While I’m still hoping that there is some benefit to holding LGO, though I’m not holding my breath.
alcira16247
Malcolm
I’m wondering if your good self or indeed other ShareProphet readers have noticed the current weakness in Tesco’s share price and feel tempted to have a punt?
After all, how bad can Christmas trading at Tesco’s really be? Surely after a year into his stewardship ‘Drastic Dave’ will have seen his various initiatives beginning to bear fruit? Maybe, the fact that competitors Sainsbury’s look to making some positive headway in the tough trading conditions give hope that Tesco’s might also be following suit? Hell, there could be good news on the horizon when Tesco’s give out their next trading update, shareholder’s could be in for a welcoming surprise, eh?
Well, maybe, but the bond markets seem to be telling a different story. You’ll remember, earlier in the year, Tesco’s credit rating was downgraded to JUNK status by two of the leading rating agencies? It now seems that with the massive sell off in bonds in the US, resulting in many hedge funds unable to meet investors redemption requests due to chronic illiquid market. Those funds holding bonds of dubious status have been particularly badly hit.
http://www.zerohedge.com/news/2015-12-22/slammed-redemption-requests-these-hedge-funds-raise-gates-avoid-firesale-liquidationNow look at the numerous Tesco bonds held by these various funds, notice how they have plummeted in value, many now barely trading above par……. an indication that investors confidence in the companies ability to meet the coupon rates and pay back capital is becoming more questionable? More worryingly still, for private investors is how Tesco’s retail bonds have likewise fallen to all times low, following in the foot steps of its corporate bonds.
http://www.londonstockexchange.com/exchange/prices-and-markets/retail-bonds/retail-bonds-search.html
I would suggest the above must give serious cause for pause to any investor considering buying Tesco’s equity.
We know that the companies balance sheet is a complete train wreck and now with its ability to increase long term borrowings from the banks and bond markets a virtual impossibility, that leaves equity holders being the only source of raising fresh capital and cut the horrendous debt mountain to more manageable proportions.
If the bond market is correct and Tesco’s are indeed struggling more than most folk are anticipating, what are the chances of a huge discounted rights issue in 2016? Would banks and institutional investors underwrite such a move? Doubtful?
Whatever the case, 2016 looks like a make or break year for the ‘Every Little Helps’ brigade.