STOCKS NEWS EUROPE-Retailers slide on John Lewis woes, Tesco up

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11:47GMT 31Oct2008-Retailers slide on John Lewis woes, Tesco up

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Shares in British retailer Marks & Spencer (MKS.L) and Kingfisher (KGF.L), the owner of the B&Q home improvement chain, slide as much as 4.7 percent and 5.3 percent, respectively, after John Lewis [JLP.UL] reports a 9.8 percent fall in weekly sales at its department stores, led by slowing homeware sales.

However, shares in Tesco (TSCO.L) rise 2.6 percent with analysts predicting value conscious shoppers will trade down to the supermarket group for cheaper food and a growing range of non-food goods. Shares in rival Wm Morrison Supermarkets (MRW.L) also rise over 2 percent.

"There's a definite shift towards consumers looking for value so I expect Tesco to perform better than M&S because it's generally cheaper and I suspect we'll see more people buying non-food items from Tesco too," says Howard Archer, an economist at IHS Global Insight.

"Homeware goods are also being hammered by the falling housing market ... if you're not moving house you're less likely to buy new furnishings or a new TV, which will impact Kingfisher." Home Retail (HOME.L), owner of DIY chain Homebase and homeware retailer Argos, is down 7.2 percent.

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