WEDNESDAY MARKET CLOSE: Traders retreat in the face of figures

The FTSE 100 was 46.32 points lower at 6,636.16 as weaker-than-expected manufacturing figures at home coincided with more worrying data from the eurozone.

Jasper Lawler, market analyst at CMC, said: “A triple-dip recession in Italy, the eurozone’s third largest economy, and Russian troops on the Ukrainian border weighed on European stocks in early trading but some stronger corporate earnings in the US helped markets pull off their lows.”

Medical and drugs stocks linked to takeover deals littered the FTSE 100 fallers’ board after it emerged that the US Treasury was reviewing its powers to stop so-called “inversion” moves. A typical example was drugs firm Pfizer’s plan to re-domicile in the UK if it had succeeded in taking over rival AstraZeneca, thereby cutting its tax bill.

But the suggestion that such deals could be tackled saw medical equipment firm Smith & Nephew, which has repeatedly been the subject of takeover speculation, slip 4 per cent, or 44p, to 1,020p.

Drugs firm Shire, which is in the throes of a takeover by America’s AbbVie, also dropped 4 per cent, down 196p to 4,680p amid suggestions the deal could be put in jeopardy. AstraZeneca was down 155.5p to 4,190p.

A shortened risers’ board included business software group Sage after it named a successor to Guy Berruyer as chief executive.

Stephen Kelly has been the boss of two software companies, including Nasdaq-listed Chordiant, and in his role as senior civil servant is leading the government’s drive to cut red tape and overhaul IT systems in Whitehall. Shares rose 2.6p to 370.7p.