Sainsbury’s share price set to trade higher ahead of Q1 results amid online sales surge

Sainsbury's will unveil its first quarter results on Wednesday 1 July, with the grocer capable of seeing its share price trade higher after a surge in online sales amid the lockdown.

However, with the British supermarket having an upside target at 226p per share, for traders looking to go long, the stop would go below the neckline at 194p, according to Jeremy Naylor, market analyst and presenter at IG.

‘The risk though is that with analysts looking for positives, the current price may have already priced in the good news, so the risk may be all the way down to the support at the inverted head at 180p,’ Naylor added.

Sainsbury’s is trading marginally higher on Monday at 208p per share at the time of publication, with the stock down 10% year-to-date.

Sainsbury’s staff members catch Covid-19 in Leicester

Investors fears of a second wave of coronavirus cases emerging in the UK as lockdown measures begin to be eased have begun to materialise this week, with some of Sainsbury’s staff members contracting the virus, according to reports on Monday.

‘The colleagues were sent home as soon as they showed symptoms and we immediately implemented additional cleaning on site,’ a spokesperson for Sainsbury’s said in a statement.

‘Safety is our highest priority and we have strict social distancing measures in all our stores including Perspex screens, limits on the number of people in the store and PPE for all our colleagues.’

Sainsbury’s sees online sales surge during lockdown

According to a recent report by Kantar, online grocery sales surged in the 12 weeks to 14 June, with the coronavirus pandemic accelerating a shift in shopping habits.

British supermarkets saw take-home sales increase by 13.7% year-on-year over the 12 week period, with revenue growth soaring 18.9% over the last four weeks.

‘Consumers are also contemplating their domestic budgets,’ Fraser McKevitt, head of retail and consumer insight at Kantar said.

‘Two thirds of shoppers are very concerned about the economic outlook for the rest of 2020, and efforts to tighten purse strings can already be seen in a preference among furloughed workers for budget, own-label lines and a move away from more premium products.’

Tesco had the highest market share of the multiples during the 12 weeks to 14 June, at 26.9%, compared to 27.3% a year earlier. Sainsbury's had a market share of 14.9%, Asda 13.9% and Morrisons 10.1%. Meanwhile, Aldi's market share was 7.5%, Waitrose was 4.8% and Iceland was 2.5%.

How to trade stocks with IG

Looking to trade Sainsbury’s and other stocks? Open a live or demo account with IG and buy (long) or sell (short) shares using derivatives like CFDs in a few easy steps:

1. Create an IG trading account or log in to your existing account
2. Enter ‘J Sainsbury’ in the search bar and select it
3. Choose your position size
4. Click on ‘buy’ or ‘sell’ in the deal ticket
5. Confirm the trade