Sainsbury’s shares jump 3% on Goldman upgrade

Shares in J Sainsbury (LSE: SBRY) rallied 3% on Friday after Goldman Sachs upgraded the supermarket chain to ‘buy’ from ‘neutral’. The US investment bank also lifted its target price to 350p from 305p previously.

In a note, Goldman said it expects UK food inflation to peak in Q1 2024 before easing back to 2% by the end of 2024, providing tailwinds for grocers. It believes Sainsbury’s has strengthened its value positioning versus discounters Aldi and Lidl while taking market share from Asda and Wm Morrison.

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Sainsbury’s shares have gained 32% year-to-date. Last month the company reported a strong set of interims, with group retail sales up 8.4%. The grocer has actively matched discounter pricing using Nectar points, helping drive a 10.1% volume increase in H1