AMAZON WHOLE FOODS TAKEOVER LOOMS OVER SECTOR

Tesco, Britain’s biggest retailer, has reported its strongest quarterly sales growth in seven years but its stellar performance was overshadowed by news of Amazon’s US$14 billion takeover of Whole Foods Market. Shares in Tesco rose as much as 4.4 per cent in early trading on Friday as its first quarter trading update showed it was successfully navigating an increasingly inflationary U.K. trading environment. But they ended the day down 4.9 per cent as investors fretted over the implications for major supermarkets of an accelerated push by e-commerce giant Amazon into traditional food retailing. Shares in Sainsbury’s, Britain’s second biggest supermarket, closed down 3.8 per cent. But shares in Morrisons, the fourth-biggest player, closed up 1.1 per cent, reflecting an existing supply deal with Amazon.