UPDATE 1-Ashtead weighs on FTSE, Ted Baker hits decade low

UK shares dropped on Tuesday after disappointing corporate updates from industrial firm Ashtead and retailer Ted Baker, while investors remained jittery ahead of the UK election and a deadline for fresh U.S. tariffs on Chinese imports. The main index slipped 0.8% by 0850 GMT, led by an 8% fall in Ashtead as the company's warning on challenging conditions in the UK overshadowed profit rise. The more domestically-focussed midcap index was 0.6% lower.

Investors also kept a close eye on UK's economic growth data scheduled for later in the day as the country heads for a snap election on Thursday. The latest poll indicates a victory for Boris Johnson-led Conservative party. Sterling has recently gained on those hopes, which in turn weighed on exporters on the FTSE 100. Trade headlines have also dictated the index's course, with the Dec. 15 deadline for a fresh round of U.S. tariffs a reason for further caution this week.

After plunging as much as 36%, Ted Baker was down 17% at levels not seen since 2009 after it announced the departure of two of its top C-suite members, canceled a dividend payout and said trading during the Black Friday period was below expectations. The fashion retailer is bracing for its worst annual performance since its 1997 listing due to setbacks, including several profit warnings and a misconduct scandal that forced founder Ray Kelvin to step down as CEO.

Some of the UK's biggest retailers dragged on the main bourse after data showed total grocery sales growth slowed to 0.5% in the 12 weeks to Dec. 1. Morrisons dropped nearly 2% and Sainsbury's declined by 1%. Engine maker Rolls-Royce fell 4.1% after the resignation of Bradley Singer, a representative of its largest shareholder the activist investor ValueAct Capital.

BAE Systems gave up 2% after a media report that Donald Trump's administration was urging Japan to choose a U.S. defense firm over a British company to develop jointly a replacement for its F-2 fighter jets. Meanwhile, Tullow Oil jumped 13% on the midcap index, a day after plunging 70% following CEO exit and dividend suspension.

IT services company Computacenter climbed 6% to its highest in nearly two decades after it raised its full-year outlook for the second time in 2019.