FTSE 100 up 0.4, FTSE 250 down 0.7

Jan 8 Reuters The UK midcap index touched a morethaneightmonth low on Thursday, as retail stocks were hammered by disappointing Christmas trading updates, while an extended rout in the bond market weighed on overall sentiment.

Tesco, Britain39;s biggest supermarket group, slid 1.7 after it maintained its fullyear profit outlook.

Marks Spencer reported a betterthanexpected 8.9 rise in likeforlike food sales in the Christmas trading period, but it warned of cost and economic headwinds this year, sending shares down 5.2.

The retail index dropped 2.9 to a near oneyear low, with discount retailer BM tumbling 13.4 after it lowered the top end of its annual profit forecast.

Greggs Plc shed 10.4 after the baker and foodtogo retailer reported a modest 2.5 growth in fourthquarter likeforlike sales, as tightpursed Christmas shoppers indulged in fewer Festive Bakes, sausage rolls, and gingerbread lattes.

The FTSE 250 index of domestically oriented stocks dropped 0.7 by 0941 GMT. The midcap index was also pressured by a sharp rise in British borrowing costs on concerns about high borrowing in Britain and higher taxes on businesses planned by finance minister Rachel Reeves.

The year ahead won39;t be all smooth sailing for the retail giants, as the sector gears up to battle imminent tax hikes, said Matt Britzman, senior equity analyst, Hargreaves Lansdown.

The benchmark 10year gilt yields have spiked by a quarter point this week alone to…