Reply To: Primary Sidebar Text Elements

I think it’s probably showing up like that since you’re not using a featured image (you don’t have to if you don’t need it).

You can add this in your css –

.sidebar .featuredpost .entry,
.sidebar .featuredpage .entry {
    padding: 0;
    margin: 0;
}

That gets rid of the padding/margin at the top and bottom of the .entry that is assigned for posts.