Top shares dragging the FTSE 250 Index as it drops into a correction

The FTSE 250 Index has moved into a correction after falling by 10% from its highest point this year. It dropped to £21,500, its lowest level since November 2025, amid concerns about the ongoing Iran war and its impact on inflation.

UK mid-cap stocks have moved into a correction 

The FTSE 250 Index has dropped in the past few weeks as global equities continued their downward trend amid the ongoing Iran war.

This war has led to a surge in energy prices in the UK, with oil and gas prices rising by over 50% since the war started in February.

UK gas prices surged on Thursday after Iran bombed the biggest natural gas plant in Qatar, leading to substantial damage that analysts believe will take months or years to repair.

As a result, the Bank of England (BoE) delivered a highly hawkish statement on Thursday. It left interest rates unchanged and hinted that it may deliver two rate hikes this year. Goldman Sachs, on the other hand, believes that the bank will leave interest rates unchanged this year and then hike in 2027.

The BoE is contending with stagflation concerns, which is characterized by high inflation and slow economic growth. The most recent data showed that UK inflation remains above 3.8% in January, while the economic growth has largely stagnated.

Top UK stocks have plunged 

Most companies in the FTSE 250 Index have plunged in the past few 30 days as the Iran war has continued.

Vistry Group, a top UK housebuilder, has dropped by 50% in the last 30 days as demand for houses drop. The company has slashed prices more aggressively than rivals as demand wanes. A recent report by RBC noted that 43% of its listed homes have had price cuts. Other companies like Barratt, Redrow, and Persimmon have all plunged in the past few months.

Wizz Air stock has plunged by 38% in the last 30 days as jet fuel prices have surged. Other airline companies like IAG and EasyJet have all plunged in the past few weeks.

Aston Martin stock price has dropped by 37% in the last 30 days as the company has dropped sharply in the past few months. Indeed, its stock has dropped by over 90% from its highest point on record. This decline happened as its sales have tumbled and its debt has jumped.

Close Brothers stock dropped by 28% in the last 30 days. This decline happened after a short seller announced that it will likely pay more money to settle insurance claims. The other top laggards in the FTSE 250 Index were companies like Hays and PageGroup, two popular names in the hiring industry.

Other laggards were companies like Bellway, Genuit Group, Atalaya Mining, and Carnival Group. On the other hand, companies like Trustpilot, Ithaca Energy, Harbour Energy, Softcat, and Mony Group were the top gainers.

FTSE 250 Index technical analysis 

FTSE 250 Index chart | Source: TradingView 

The daily chart shows that the FTSE 250 Index has slumped in the past few weeks, moving from a high of £23,756 to the current £21,560.

It has dropped below the 50-day and 200-day Exponential Moving Averages, confirming that bearish outlook. It has dropped below the 23.6% Fibonacci Retracement level at £23,213.

The Relative Strength Index and the Percentage Price Oscillator (PPO) have continued falling and are at the lowest level in months. Therefore, the index will likely continue falling as sellers target the next key target at £21,000.