<div id="readability-page-1"><div>** Jefferies downgrades British retailers Tesco and Next to &#34;hold&#34; from &#34;buy&#34;, citing peak valuations, tough comparable sales, and an unhelpful macro backdrop** Tesco shares down ~1%, while Next is marginally lower** Jefferies says for the first time since early 2023, like-for-like sales at major UK retailers are growing faster than consumers' disposable income** &#34;There is a disconnect between market optimism and consumer confidence&#34; - Jefferies** Brokerage also downgrades Associated British Foods to &#34;underperform&#34; from &#34;neutral&#34; and trims PT to 1,800p from 2,000p; ABF shares fall 1.5%** &#34;We see more pressing concerns at ABF, with Primark's challenges likely to continue&#34; - Jefferies** Last month, co said it's exploring spin-off of Primark fashion chain from its food businesses** YTD, Tesco up 18.5%, Next rose ~40%, while ABF up ~0.5%</div></div>

TSCDY

Jefferies downgrades UK retailers Tesco and Next to 'hold' from 'buy' due to peak valuations and tough comparable sales. Tesco shares down ~1%, Next marginally lower. Associated British Foods downgraded to 'underperform' from 'neutral', PT trimmed to 1,800p from 2,000p; shares fall 1.5%. Jefferies cites disconnect between market optimism and consumer confidence, and concerns over Primark's challenges. YTD, Tesco up 18.5%, Next up ~40%, ABF up ~0.5%.

Jefferies cautious on UK retailers for 2026, downgrades Tesco, Next and AB Foods