Why do shares always go up by the amount of dividend paid?

Shares typically do not always go up by the exact amount of the dividend paid; instead, they may drop by a similar amount on the ex-dividend date. This drop reflects the fact that new shareholders are not entitled to the recently declared dividend, effectively reducing the company's value by the amount of the dividend. However, market perceptions, overall economic conditions, and investor sentiment can also influence share prices, leading to variations in the price movement around dividend announcements.