Markets: Glaxo fail to cure FTSE ills

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Good news for heavyweights GlaxoSmithKline and Vodafone wasn’t enough to drag the FTSE 100 higher yesterday as a poor opening from American markets weighed on sentiment.

Once the starting bell sounded across the pond, London’s top share index gave up its morning gains to close 0.54 points lower at 6,243.67.

Glaxo added 51p at 1,658p after having a new lung drug approved, while Vodafone was bolstered by positive subscription numbers from its US joint venture and gained 3.25p to close at 192.5p.

William Nicholls at Capital Spreads said the two giants added about ten points each to the FTSE, lending the market a false sense of strength. “The ‘relative’ strength of UK equities compared to the week as a whole can actually be perceived as weakness, but for a medical decision and an American telecoms firm having a good start to the year,” he said.

Engineering group GKN was another riser after chief executive Nigel Stein said he expected an improvement in results now that restructuring charges are out the way. First quarter sales rose 9 per cent to £1.9 billion, and shares responded by accelerating 6.3p to 252p.

Rumours that a French bank was in trouble, although later scotched, were a painful remainder to the sector of ongoing weaknesses. State-backed duo Lloyds and Royal Bank of Scotland were both on the fallers’ board, down 1.14p and 9.3p respectively at 47.08p and 273.9p.

Shares in housebuilder Persimmon were 3p higher at 1,109p after it reported a pick-up in visitors to its developments. That buoyed peers including Taylor Wimpey, 1.1p ahead to 89.7p; Barratt Developments, 8p up to 291.1p; and Berkeley Group, 38p higher to 2,033p.

NEW YORK: Wall Street fell last night for the third day this week after data showed signs of slower growth ahead for the US economy, while bearish technical signals added to doubts about the market’s strength.

The Dow Jones industrial average slid 81.37 points, or 0.56 per cent, to end at 14,537.22 while the Standard & Poor’s 500 Index dropped 10.39 points, or 0.67 per cent, to finish at 1,541.62. The Nasdaq Composite Index lost 38.31 points, or 1.20 per cent, to close at 3,166.36.