Superstore prices tumble as investors rush to check-outs

Another rush for the superstore check-out was the highlight of a stock market struggling to enjoy its record-breaking burst.

Doubts have been multiplying about the sector's ability to hold margins as com- petition intensifies. Figures earlier this month from J Sainsbury came as an unpleasant surprise, underlining that the happy-go-lucky days of seemingly unstoppable pro- gress were over.

There was talk of cautious investment comments being prepared but the only observations to surface emerged at Kleinwort Benson which took a bearish view of supermarkets in general and Sainsbury in particular.

Sainsbury fell 11p to 382p; the price has come down from 425p since the results and from a year's high of 479.5p.

Argyll, interim figures later this month, was cut 16p to 298p; Asda 4p to 99.5p and Tesco, which is seen gaining market share from Sainsbury, 12.5p to 283.5p.

The supermarket discomfort has to some extent been masked by the blue- chip exuberance that has driven many shares to new highs.

It is not only Sainsbury which seems to have moved beyond its investment sell-by date. Argyll has come down from 369p this year, Asda from 111p and Tesco 339p.

Others weak included Iceland, off 6p at 154p; Kwik Save 14p at 596p and Wm Morrison 4.5p to 146.5p.

The rest of the market had a subdued day, taking a breather after its exertions this week which lifted the FT-SE 100 index more than 80 points to Thursday's peak.

At one time Footsie was up 15.9 points to a trading high of 3,626.7. But the upsurge owed more to the expiry of the November options contract, with two leading houses jockeying for position, than continuing investment buying.

Although the index finished 1.6 lower at 3,609.2 the market undertone remained confident. Talk of interest rate cuts is still in the air and many remain convinced New York's record-blazing run, despite some hesitancy, is far from over. The Budget remains a nagging influence. But recent Whitehall statistics have been encouraging.

Shell, reflecting an investment presentation and the market's acceptance of its Nigerian case, spurted 18.5p to 787.5p and London Electricity's 100p dividend added 19p to 933p.

The inconclusive negotiations between South Wales Electricity and Welsh Water had little impact on the respective shares.

Sears, the retailer, stumbled 2p to 100p as Merrill Lynch joined the downgrading march, lowering its forecast pounds 15m to pounds 115m and saying sell.

Trading worries lowered Rexam, the packaging group, 13p to 372p and Zeneca lost a little of its glow, falling 17p to 1,296p as the alleged takeover stalker failed to appear.

The colder weather failed to help British Gas, off 4p at 237.5p, but possible construction savings of up to pounds 150m lifted British Steel 3p to 166p.

Astec (BTR), the electronic group, moved ahead 6.5p to 130p after its presentation and Vickers, also on an investment meeting, rose 3p to 266p.

High-tech stocks produced some fun. Unipalm ended 110p higher at 865p as the value of its US bid continued to increase; Firecrest, following another Internet deal, gained 28p to 203p. The shares have surged from 67p last week.

MAID was caught by a delay in its US listing, falling 15p to 301p. Dealings are now likely to start on Tuesday.

Vero, an electronic parts maker, made a strong debut although there were muttering that the savage scaling down of applications had left some investors with unrealistically small shareholdings. Placed at 220p the shares reached 276.5p.

BICC made further headway, up 11p to 276p, on takeover talk and builder Redrow, said to be keen on Crest Nicholson, gained 3p to 128p.

Northern Leisure, a discotheque operator, reported "usefully" higher profits and rose 4p to a 96p peak.

Aviva, the oil group, jumped 10p to 55p on bid talks and Beverley, an engineer, held at 1.25p as it confirmed a cash-raising exercise to deal with a record rush of orders. It is raising pounds 850,000 via a placing and open offer at 1.25p.

Profit warnings hit Eurodollar, a car hire group, down 39p to 68p, and Epwin, a building materials group, 32p to 223p.

Era, the retailer, firmed to 9.75p after Greig Middleton forecast year's profits of pounds 2m; Surrey Free Inns put on 3p to 113p with Teather & Greenwood suggesting profits of pounds 1.3m this year.

TAKING STOCK

r Burford, the property group headed by Nigel Wray, gained 6p to 138.5p ahead of the demerger of its Trocadero operation. Dealings in the shares of the Piccadilly entertainment complex are due to start on 27 November. Burford shareholders will get Troc shares on a one-for-one ration.

The property group will retain 29.5 pere cent of the entertainment centre which cost Burford pounds 96m last year and was valued at pounds 115m in September.

r CPL Aromas, a maker of flavourings and fragrances, has moved ahead this month, anticipating interim figures. The shares gained a further 3p to 353p, making a 40p improvement. They were floated at 150p in June last year. The interim profit is likely to be around pounds 1.3m against pounds 930,000.