UK Stocks Edge Higher, M&s Slips on Gloomy Outlook

By Sruthi Shankar

(Reuters) -UK stocks edged higher on Wednesday as the global mood steadied after a bruising previous session, while Marks & Spencer slipped on a warning that rising cost pressures and economic uncertainty would weigh on its outlook.

The blue-chip FTSE 100 index was up 0.4%, with commodity majors providing the biggest boost.

Glencore Plc gained 2.7% after the global miner said it anticipates paying up to $1.5 billion to settle accusations of bribery and market manipulation.

Power company SSE Plc climbed 4.6% after reporting a surge in annual profit and saying it was investing significantly more than it was making in profit to help reduce dependency on imported gas.

Its stock shed almost 8% on Tuesday, hit by a report that the British government is planning windfall taxes on power generators.

Retailer Marks & Spencer was down 0.3% after hitting its lowest since December earlier in the session. The company joined rivals in warning about the outlook for the current year and said it will pull out of Russia.

Online supermarket and technology group Ocado Group slid 4.2% after Ocado Retail slashed its growth outlook in a move that also put pressure on shares of rival chains Sainsbury and Tesco.

“Ocado is going to struggle because their costs rest disproportionately on transport and logistics compared with a traditional retailer,” said David Madden, market analyst at Equiti Capital.

“Costs are probably going up at a higher rate than they’re increasing prices to the end consumer, and their margin is going to be squeezed.”

The mid-cap index added 0.2%, with pet supplies retailer Pets at Home topping gains with an 8.3% jump after reporting annual results.

Overall, a surge in commodity prices has helped the commodity-heavy FTSE 100 outperform in 2022, although growing worries about a recession has sent the domestically focussed midcap index down over 15% this year.

(Reporting by Sruthi Shankar in Bengaluru; editing by Uttaresh.V and Aditya Soni)