Last checked at 
LONDON (Alliance News) - Concerns about Greece continue to damp investor sentiment mid-morning Friday, with London stock indices all trading lower, but Tesco has provided some optimism as the grocer's decline in like-for-like sales slowed in its first-quarter.
The UK's largest supermarket by market capitalisation reported a 1.3% drop in group like-for-like sales excluding fuel in the 13 weeks to May 30, as combined UK and Republic of Ireland like-for-like sales declined 1.5% and international like-for-likes fell 1.0%.
However, this was an improvement on the fourth quarter of the last financial year which saw like-for-like sales fall 1.8% on a group basis, 2.0% in the UK and Ireland and 1.6% internationally. It also was better than first quarter a year earlier, when sales on the same basis fell 3.4% for the group, 4.1% in the UK and Ireland, and 1.7% internationally.
In addition, UK like-for-like volumes were up 1.4% in the quarter, with transactions growing by 1.3% as it took on 180,000 more customers, Tesco said. "This will be a volume-led recovery," Chief Executive Dave Lewis told journalists on Friday, adding that "these are positive early signs".
Bryan Roberts, retail insights director at Kantar Retail, likes Tesco's "direction of travel".
"Overall, this morning's update from Tesco is a reassuring one with momentum very much in place in the UK, a resurgent performance in Central & Eastern Europe, and the trends in Asia moving in the right direction despite severe headwinds," Roberts says. "It's too early to call a full-on recovery, but tentative plaudits are deserved for the direction of travel."
Tesco is the best performer in the FTSE 100, trading up 4.3%. The positive results also have lifted fellow supermarkets J Sainsbury, up 1.6%, and Wm Morrison Supermarkets, up 1.2%.
The FTSE 100 trades down 1.0% at 6,743.35, the FTSE 250 is down 0.7% at 17,821.64, and the AIM All-Share index is down 0.2% at 770.74.
In Europe, the CAC 40 in Paris is down 0.6% and the DAX 30 in Frankfurt is down 0.5%.
The Shanghai Composite closed down 7.4% Friday, as the securities regulator tightens margin financing. The Securities Regulatory Commission published draft rules earlier this month that would cap the size of the country's margin trading and short selling for the first time, at four times a brokerage's net capital.
The fall in the Chinese stock market hit Fidelity China Special Solutions, which is the worst performer in the FTSE 250, down 7.1%. Miners also are trading heavily lower.
Evraz trades down 3.6%, after it priced a four year RUB15 billion bond at a coupon rate of 12.95% per year late Thursday and said it plans to use proceeds from the bond issue to refinance its existing debt.
Media company Trinity Mirror, down 3.3%, said it is expanding its cost-reduction programme due to a "more challenging revenue environment", as it expects revenue in its first half to fall, although it still anticipates meeting profit expectations for its full year.
For the 26 weeks to June 28, Trinity expects revenue to fall 11% compared to the previous year, as more challenging print advertising markets will lead to a 19% fall in print advertising revenue. Circulation revenue is expected to fall by 6%, although revenue trends will show improvement from May after a cover price increase for the Daily Mirror's Monday to Friday edition, the company said.
The lack of progress in negotiations on a cash-for-reform deal for Athens is keeping investors at bay ahead of Saturday's Eurogroup meeting. Greece's current bailout expires on Tuesday, when it is also due to pay a loan instalment to the International Monetary Fund.
A Greek minister said that Greece may be forced to call snap elections if creditors do not budge on their demands. "Every time [Greece] goes to find a solution, they come and tell you, 'bring some pensioners so that we execute them'," Labour Minister Panos Skourletis told Greek TV Mega of Athens' long-running negotiations with its creditors.
Greece may end up with a "recourse to elections" if creditor institutions - the European Commission, the European Central Bank and the International Monetary Fund - continue to insist on terms outside the government's mandate from the public, Skourletis said.
Mike van Dulken, head of research at Accendo Markets, says Greece's situation is forcing the trading bloc into uncharted territory.
"While another last-minute weekend agreement would surely mean a relief rally come Monday, continued stubbornness on both sides could equally take us into uncharted default/euro-exit territory and the accompanying uncertainty send markets lower," van Dulken says.
Still ahead in the economic calendar, US Reuters/Michigan Consumer Sentiment Index is at 1500 BST and Bank of England Governor Mark Carney will be making a speech at the Inclusive Capitalism Annual conference in London at 1545 BST.
By Neil Thakrar; neilthakrar@alliancenews.com; @NeilThakrar1
Copyright 2015 Alliance News Limited. All Rights Reserved.