UK's Sainsbury's upgrades outlook after strong Christmas

Sainsbury's, Britain's second-biggest supermarket, on Wednesday reported a better-than-expected performance in its Christmas quarter and upgraded its sales forecast for the second half.

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The firm, which revealed last week that it had a November bid approach for Argos owner Home Retail <HOME.L> rejected, said sales at stores open over a year fell 0.4 percent, excluding fuel, in the 15 weeks to Jan. 9, its fiscal third quarter.

That compared to analysts' average forecast of a fall of 0.7 percent and a second quarter decline of 1.1 percent.

Sainsbury's said it now expects its like-for-like sales in the second half of the year to be better than the first.

Previously it had expected a similar performance.