UPDATE 1-Tesco woes drag down Norway's $860 bln wealth fund in third quarter

miércoles 29 de octubre de 2014 09:35 GYT

* Fund returns 0.1 pct in Q3

* U.S. stocks gains offset by European stocks losses

* Fund to apply soon to invest more in China -CEO

* Fund may soon be able to invest directly in infrastructure (Adds fund chief's comments on Tesco, investments in China and infrastructure investments)

OSLO, Oct 29 (Reuters) - Norway's $860-billion sovereign wealth fund, the world's largest, booked a flat return in the third quarter as it was dragged down by weak European stocks, foremost among them embattled retailer Tesco.

The fund, one of the world's biggest investors, is the top shareholder in the British supermarket group, which has lost 53 percent of its market value over the past year after an accounting scandal and a number of profit warnings.

"It is clear that our investment in the British company Tesco has performed particularly poorly in the course of the year," Chief Executive Yngve Slyngstad told a news conference to present the fund's third-quarter results.

The wealth fund owns 6.98 percent of Tesco after raising its stake by 44 percent in less than two years, according to Thomson Reuters Eikon data. Other top investors such as U.S. billionaire Warren Buffett have cut their shares and Buffett called investing in Tesco a "huge mistake".

Slyngstad declined to comment on what he thought the retailer should do to solve its problems but told Reuters the fund was in "a dialogue with the board and the leadership of Tesco".   Continuación...