UPDATE 2-Morrisons and Tesco shine in Christmas sales battle

From Reuters - January 9, 2018

* Morrisons beats forecasts with Christmas sales up 2.8 pct

* Morrisons share rise as much as 4.8 pct

* Survey data shows Tesco the best performer at Christmas

* Sainsburys, Asda perform solidly

* Aldi and Lidl still winning market share (Adds detail, CEO comment, Kantar/Nielsen and BRC data, shares)

By James Davey

LONDON, Jan 9 (Reuters) - British supermarket chain Morrisons beat sales growth forecasts over Christmas while industry data indicated market leader Tesco probably outperformed smaller rivals during the festive season.

With Britons facing pressure from slow wage growth and the jump in inflation that followed the 2016 Brexit vote, company updates and data this month have shown they chose to prioritise spending on food and drink over the holiday season.

Shoppers cut back on almost everything other than food in the last three months of 2017, causing the biggest fall in non-grocery spending since 2009, figures from the British Retail Consortium (BRC) showed on Tuesday.

The divergence between growth in sales of food and non-food has never been so stark, BRC chief executive Helen Dickinson said.

Shares in Morrisons, the smallest of Britains four big supermarket groups, were up 2.3 percent at 1015 GMT after its trading update showed it attracted more customers with competitive prices, expanded premium ranges and an improved online range.

But Christmas trading survey data from both Kantar Worldpanel and Nielsen showed clear market leader Tesco enjoyed the strongest performance of the four chains over the Christmas quarter with total sales growth put at 3.1 percent and 3.4 percent respectively.



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