Amazon deal hits FTSE 100 supermarkets

Supermarket shares fell to the bottom of the FTSE 100 as news of Amazon’s £10.7 billion takeover of supermarket chain Whole Foods sparked jitters over more competition in the grocery sector.

London’s blue-chip index ended the day up 44.18 points at 7,463.54 but shares in Tesco closed down 8.85p at 171.1p and J Sainsbury dropped 10.1p to 252.3p.

Tesco shares had previously been on the rise after reporting its sixth consecutive quarter of positive sales but were hit after Amazon announced it was acquiring Whole Foods in an all-cash deal.

Shares in Morrison Supermarkets, which has a standing deal to sell groceries through Amazon, rose 2.7p to 242.6p.

In currency markets, the pound was mixed, rising nearly 0.2 per cent versus the US dollar to $1.277 but falling 0.1 per cent against the euro to €1.141.

In UK stocks, British Airways owner IAG saw shares rise 4.5p to 588.5p despite news that cabin crew will stage a two-week strike in a long-running dispute over pay and travel concessions, starting on 1 July.

Rolls-royce shares climbed 12.5p to 907.5p after the aircraft engine maker said in a trading update that the collapse in sterling will boost revenues and profits.

The biggest risers on the FTSE 100 included St James’s Place, up 50p to 1,236p, and Worldpay Group, up 11.3p to 323.3p.

The biggest fallers included Anglo American, down 27.8p to 967.3p, and Marks and Spencer, down 6.6p to 345.2p.