Tesco, the groceries and general merchandise retailer, posted 1Q group revenue rose 8.0% on year at constant rates (+7.9% like-for-like) to 13.38 billion pounds.
The company said: "Total sales in our UK & ROI business increased by 9.2%. Growth was most marked in online with sales up 48.5% for the quarter as a whole and the rate of growth increasing to nearly 100% by the end of May.
Whilst any forecast is inherently uncertain, based on an assumption of a continued easing of lockdown restrictions in the UK, our current expectation is that Retail operating profit in the current year is likely to be at a similar level to 2019/20 on a continuing operations basis.
We have increased our provision for potential bad debts at Tesco Bank and we now expect to report a loss for the Bank of between £(175)m and £(200)m for the 2020/21 financial year."
From a technical perspective, the stock price remains stuck in trading range between 221p and 235p. The 20-day simple moving average started to flatten out and the daily Relative Strength index (RSI, 14) is around its neutrality area at 50%. As long as 221p is support, a test of the upper end of the range at 235p can be expected. A break below 221p would deliver a bearish signal and would open a path to see 203.7p. Alternatively, a push above 235p would call for a new up leg towards 250p.
Source: GAIN Capital, TradingView
