* Q3 underlying sales up 3.6 percent vs forecast 3.4 percent
* Analysts see performance best of top 4 UK grocers
* Greggs, N Brown sales edge up, Supergroup soars
* Stockmann warns on profit, Douglas says Xmas respectable
* Sainsbury shares slip on lack of profit upgrade
(Adds company, analyst comments, shares, detail, background)
By Mark Potter and James Davey
LONDON, Jan 12 (Reuters) - J Sainsbury Plc led a rise in sales at Britain's supermarkets over Christmas, as they benefited from their status as one-stop shops to take business from specialist retailers hit by bad weather disruption.
"I think it would be fair to say that grocers as a sector have had the best of it," Chief Executive Justin King said on Wednesday after Sainsbury beat Christmas sales forecasts.
Retailers across Europe and north America, including Metro AG, Gap Inc and HMV Group Plc have blamed severe winter weather for denting sales over Christmas.
However, some analysts say the heavy snow has been used as an excuse for poor performances in a tough environment marked by rising taxes and commodity prices.
"Economic confidence had a bigger negative influence on actual Christmas spending than snow," said Paul Hudson, head of consumer research firm Intersperience, noting the rise of grocers to challenge specialist retailers is a long-term trend.
Sainsbury, Britain's No.3 grocer behind Tesco Plc and Wal-Mart Stores Inc's Asda in terms of annual sales, said sales at stores open more than a year rose 3.6 percent, excluding fuel but including VAT sales tax, in the 14 weeks to Jan. 8, its fiscal third quarter.
That was up from a 2.9 percent increase in the second quarter and compared with an average forecast for a rise of 3.4 percent in a Reuters poll of 15 analysts.
"The clear winner over Christmas," said analyst Philip Dorgan at brokerage Altium, echoing findings from market researchers Kantar Worldpanel and Nielsen that showed Sainsbury's beating sales growth of rivals at Christmas.
Tesco reports Christmas sales on Thursday.
Despite its strong performance, however, Sainsbury shares slipped 1.3 percent to 385.4 pence by 0920 GMT on some disappointment it did not raise full-year profit forecasts.
"January is not the time to take a new view of profit, because January, February and March is a fiercely competitive period," King told reporters, adding that analysts had already lifted their forecasts a couple of times this fiscal year.
Sainsbury shares have outperformed the STOXX Europe 600 retail index by 13 percent over the past year.
"Meaningful (profit) upgrades are necessary to drive the share higher," said analyst Clive Black at brokerage Shore Capital.
TASTE THE DIFFERENCE
Kantar said on Tuesdayÿ that while Britain's grocers prospered over Christmas, specialist retailers struggled, a trend was broadly confirmed in other data on Wednesday.
British baker Greggs Plc, for example, reported a modest 0.6 percent rise in underlying Christmas sales, while home shopping group N Brown posted a 1.2 percent increase. Further afield Finland's Stockmann Oyj warned on profits.
British fashion firm Supergroup Plc bucked the trend, however, with a 90 percent leap in sales, while German fragrance-to-books retailer Douglas Holding Ag said it had a "respectable" Christmas.
Sainsbury's King said companies which blamed bad weather for poor sales had not prepared adequately. "The snow had an impact, but if you lie back and become a victim to the snow, you're not doing what we are here to do," he told reporters.
Sainsbury said its growth was driven by a 10 percent rise in sales of its premium "Taste the Difference" range, while non-food sales grew three times the rate of food.
Food price inflation contributed around 1.5 to 2.0 percent to sales growth, lower than official data suggest, Finance Director John Rogers told Reuters Insider.
He said retailers and suppliers were working hard to offset some of the rise in commodity costs by becoming more efficient and noted shoppers were also cutting back on products which had seen particularly big increases, such as lamb.
Excluding VAT sales tax, Sainsbury's underlying sales growth was 2.8 percent, compared with a 1 percent increase posted by industry No.4 Morrisons for the six weeks to Jan. 2 and a 0.9 percent rise in underlying UK sales analysts expect from Tesco on Thursday. (Editing by Kate Holton and David Holmes) ($1=.6413 Pound)