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UK stocks edge lower as ex-dividend stocks weigh

written by Bella Palmer

The blue-chip FTSE 100 dropped 1.0%, while the midcap index slipped 0.7%

UK stocks edged lower on Wednesday ahead of an extended public holiday weekend, as ex-dividend trading impacted shares of National Grid and Vodafone, while Dr. Martens surged more than 20% after the footwear brand lifted its annual revenue forecast.

The blue-chip FTSE 100 snapped a five-session winning streak to drop 1.0%, with National Grid and Vodafone down 4.3% and 3.0%, respectively. The domestically focused midcap index slipped 0.7%.

UK markets will be closed on Thursday and Friday for Queen Elizabeth's Platinum Jubilee.

The FTSE 100 closed out May with a 0.8% gain, boosted by commodity stocks as oil prices gained on the prospect of a European Union ban on Russian oil. However, the domestically oriented FTSE 250 suffered a monthly loss, hit by concerns over rapid inflation and an economic slowdown.

By the time investors have returned after the festivities they could be facing a big hangover, depending on the turn Wall Street takes over the next few days and the latest U.S. jobs reading due on Friday, Russ Mould, investment director at AJ Bell said in a note.

Inflationary concerns look set to continue to dominate the market mood, Mould added.

Dr. Martens soared after the company gave an upbeat annual revenue growth forecast, underpinned by price hikes made in response to soaring inflation and stronger sales of its shoes and boots.

A British Retail Consortium report showed retailers raised prices at the fastest pace in more than a decade last month, driven by the rapidly rising cost of food, and increased energy and transport costs for stores.

Capricorn Energy gained 1.2% after agreeing with Tullow Oil to merge in an all-stock deal worth 656.9 million pounds ($826.7 million). Shares of Tullow Oil were down 2.0%.


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