London, Feb 3, 2026, 08:36 GMT — Regular session
- Tesco shares slipped in early trading, reversing some of Monday’s gains.
- UK grocery inflation slowed to 4.0%, with Tesco expanding its market share, according to industry data.
- Attention shifts to the Bank of England on Feb. 5, with UK CPI data due Feb. 18 and Tesco’s earnings set for April 16.
Tesco shares edged down 0.1% to 430.9 pence shortly after the open, starting at 430.4 pence and dipping as low as 426.1 pence for a moment.
The stock is reacting to new data on UK grocery price growth — a shift that can swiftly change shopper habits and how aggressively supermarkets roll out promotions.
Food inflation matters now since it takes up a large chunk of household budgets and influences the broader inflation picture policymakers consider when adjusting interest rates.
UK grocery inflation dropped to 4.0% in the four weeks ending Jan. 25, hitting its lowest level since April, down from 4.3% in the prior period, according to Worldpanel by Numerator. Fraser McKevitt noted shoppers were still focused on value, with own-label products accounting for 52.2% of spending. Over the 12 weeks to Jan. 25, Tesco’s sales climbed 4.4%, lifting its market share by 20 basis points to 28.7%. J Sainsbury, Lidl, and Ocado saw faster growth, while Asda fell behind.
The early drop comes after a solid day for Tesco. On Monday, shares climbed 1.46% to 4.31 pounds, while the FTSE 100 notched a 1.15% gain, closing at a record high, according to MarketWatch data.
Company news was sparse. On Monday, Tesco released a regulatory update confirming it had 6,385,182,796 ordinary shares outstanding as of Jan. 31, with no shares held in treasury. This routine disclosure supports UK transparency requirements.
Rates take center stage this week as the Bank of England prepares to release its February policy decision and meeting minutes on Thursday.
Investors are eyeing a key date: the UK’s consumer price inflation figures for January drop on Feb. 18 at 0700 GMT, per the Office for National Statistics.
Tesco’s next major company update won’t come until April 16, when it releases preliminary results for the 2025/26 fiscal year.
But lower grocery inflation isn’t all good news. If prices drop faster than costs do, retailers may have to offer bigger discounts to keep sales up, squeezing margins even as customers get some break at the checkout.
Next up: the Feb. 5 rate decision and the Feb. 18 CPI data. After that, all eyes shift to Tesco’s April 16 earnings, where investors will see if market share gains are translating into profits and cash flow.
