SUPERMARKET chain Sainsbury's drew encouragement from its Christmas trading performance yesterday, despite posting another fall in sales.

The company, which recently announced losses for the first time in its 135-year history, said like-for-like sales in the four weeks to January 1 fell 0.4 per cent, although this figure improved to a 2.5 per cent gain when petrol sales were included.

The performance last month represented a brighter trend for the chain after it said underlying non-petrol sales fell 1.2 per cent in the last 12 weeks of the year.

Chief executive Justin King described the results as a good first step.

Anthony Platts, assistant director at Tees Valley stockbrokers Wise Speke, said: "The group has had to spend a lot of money rectifying problems within the supply chain and the trading figures would imply that this is on the way to being solved.

"After the disappointments of the past few years, Sainsbury's is always going to be playing catch-up, but at this rate, it looks as if they are getting there."