Global risk-off mood hits UK stocks, Dr Martens slumps to record low

Miners, energy firms drag FTSE 100 lower; Dr Martens hits record low
Miners, energy firms drag FTSE 100 lower; Dr Martens hits record low Copyright Thomson Reuters 2023
By Reuters
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By Johann M Cherian and Shashwat Chauhan

-The UK’s main stock indexes tumbled on Thursday in a broad-based selloff sparked by worries over a recession, while shares of Dr. Martens slumped to a record low after the bootmaker issued a profit warning.

The blue-chip FTSE 100 slid 1.1%, its biggest single-day drop in five weeks. The index had come close to hitting a record high earlier this week.

Global markets were rattled on Thursday after weak U.S. economic data compounded fears of a recession while hawkish comments from the U.S. Federal Reserve and the European Central Bank further hurt sentiment.

“Enthusiasm is being tempered by some weaker economic data points that have come out over the last couple of days,” said Patrick Armstrong, chief investment officer at Plurimi Wealth.

UK data showing accelerating pay growth and inflation residing in double-digit territory this week also fuelled worries that the Bank of England (BoE) will keep hiking rates.

Markets are leaning heavily towards a 50-basis point hike by the central bank on Feb. 2.

However, BoE Governor Andrew Bailey said there was now more optimism about inflation falling this year, and noted the central bank had not pushed back against market expectations for interest rates to peak at 4.5%.

Industrial miners shed 2.0% as copper prices eased on worries about weak demand as top metals consumer China prepares for holidays and other economies slow down under the weight of high interest rates. [MET/L]

The domestically-oriented FTSE 250 shed 1.6%, with Dr Martens crashing 30.7% to a record low after the bootmaker issued a profit warning citing operational issues out of its U.S distribution centres.

Boohoo dropped 10.5% after the online fashion retailer said its revenue fell during the Christmas trading period, hurt by delivery disruption and tough comparatives.

Network International tumbled 10.4% after the digital commerce enabler forecast a lower core profit margin for 2023.

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