London midday: FTSE pares gains as GSK tumbles

London stocks had pared gains by midday on Friday, with GSK under the cosh.

The FTSE 100 was flat at 8,971.33, having breached the 9,000 again earlier in the day,

Dan Coatsworth, investment analyst at AJ Bell, said: "The FTSE 100 is the ultimate tease, once again flirting above the 9,000 level before taking a step back."

In equity markets, BP gushed higher as it agreed to sell its US onshore wind business, BP Wind Energy, to LS Power, a development, investment and operating company focused on the North American power and energy infrastructure sector.

No financial details were disclosed, but BP said that once the deal completes, BP Wind Energy will be owned and operated as part of LS Power portfolio company Clearlight Energy, increasing its operating fleet to around 4.3GW.

Ocado surged for the second day in a row after saying on Thursday that its full-year outlook remains on track as it swung to a big profit in the first half, in which both the tech and logistics divisions delivered double-digit top-line increases.

Industrial parts maker Senior shot higher as it announced the sale of its aerostructures business to Sullivan Street Partners, a UK-based private equity investor, for a total enterprise value of up to £200m. Proceeds from the sale will be used to reduce net debt and fund a £40m share buyback.

Luxury fashion house Burberry jumped as it said comparable sales fell by 1% in the three months to 28 June, beating expectations for a 3% decline.

Consumer goods giant Reckitt Benckiser pared earlier gains as it said it was selling off a controlling share in its Essential Home division to private equity firm Advent International in a deal that values the portfolio at $4.8bn.

Reckitt will retain a 30% equity stake in the business and said it plans to return $2.2bn to shareholders via a special dividend along with a share consolidation upon completion.

On the downside, GSK tumbled after the US Food and Drug Administration recommended against approving its blood cancer drug Blenrep.

Coatsworth said: "A troubling £3.8 billion has been wiped off the value of GSK after the US drug regulator cast doubt over its blood cancer drug, Blenrep, being approved for use.

"The FDA has voted against the proposed dosage from a benefit/risk perspective. It means the likelihood of Blenrep’s approval next week is looking extremely slim.

"There is always a high risk with drug developments and pharmaceutical companies are no strangers to setbacks. However, Blenrep was particularly important to GSK, with analysts forecasting peak annual sales in the region of £2.9 billion and the drug had one of the highest probabilities of approval in its pipeline.

"This situation, along with the prospect of new tariffs on drugs imported into the US, means GSK is suddenly on the sick bed. GSK has lost nearly a tenth of its market value in the past eight days, which is worrying for a company of its stature."

Elsewhere, Barclays was also weaker after a downgrade to ‘neutral’ from ‘buy’ at Citi, while Softcat slumped as JPMorgan placed the shares on ‘negative catalyst watch’ ahead of results.

Market Movers

FTSE 100 (UKX) 8,971.33 -0.01%
FTSE 250 (MCX) 21,871.98 0.48%
techMARK (TASX) 5,164.28 -0.36%

FTSE 100 - Risers

Melrose Industries (MRO) 548.40p 2.31%
Antofagasta (ANTO) 1,860.00p 2.11%
Schroders (SDR) 399.80p 1.99%
Marks & Spencer Group (MKS) 341.50p 1.76%
Anglo American (AAL) 2,232.00p 1.59%
3i Group (III) 4,307.00p 1.48%
Associated British Foods (ABF) 2,190.00p 1.48%
Rentokil Initial (RTO) 352.00p 1.44%
Kingfisher (KGF) 281.90p 1.44%
BP (BP.) 402.95p 1.43%

FTSE 100 - Fallers

GSK (GSK) 1,324.50p -6.26%
Mondi (MNDI) 1,133.50p -2.91%
Games Workshop Group (GAW) 16,080.00p -1.11%
Berkeley Group Holdings (The) (BKG) 3,580.00p -1.00%
Barclays (BARC) 347.75p -0.98%
Centrica (CNA) 152.90p -0.78%
Smurfit Westrock (DI) (SWR) 3,386.00p -0.76%
Lloyds Banking Group (LLOY) 77.62p -0.74%
London Stock Exchange Group (LSEG) 10,775.00p -0.74%
NATWEST GROUP (NWG) 493.30p -0.64%

FTSE 250 - Risers

Ocado Group (OCDO) 310.00p 11.11%
Senior (SNR) 202.50p 7.83%
Burberry Group (BRBY) 1,334.50p 6.93%
Chrysalis Investments Limited NPV (CHRY) 114.60p 4.75%
RHI Magnesita N.V. (DI) (RHIM) 3,000.00p 4.17%
Frasers Group (FRAS) 700.50p 3.24%
Hochschild Mining (HOC) 272.60p 3.18%
Watches of Switzerland Group (WOSG) 364.20p 2.59%
QinetiQ Group (QQ.) 506.00p 2.43%
Future (FUTR) 749.50p 2.39%

FTSE 250 - Fallers

Softcat (SCT) 1,593.00p -4.84%
W.A.G Payment Solutions (WPS) 85.80p -2.72%
Trustpilot Group (TRST) 263.20p -1.57%
4Imprint Group (FOUR) 3,570.00p -1.52%
Oxford Nanopore Technologies (ONT) 147.50p -1.34%
Drax Group (DRX) 680.50p -1.23%
Vesuvius (VSVS) 383.60p -1.18%
Telecom Plus (TEP) 1,982.00p -1.15%
TBC Bank Group (TBCG) 4,890.00p -1.11%
Bytes Technology Group (BYIT) 336.40p -1.06%