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GSK boost helps FTSE 100 snap three-day losing streak

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GSK boost helps FTSE 100 snap three-day losing streak
FILE PHOTO: The GlaxoSmithKline (GSK) logo is seen on top of GSK Asia House in Singapore, March 21, 2018. REUTERS/Loriene Perera/File Photo   -   Copyright  Loriene Perera(Reuters)
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(Reuters) – Pharmaceuticals giant GSK led the FTSE 100 higher on Wednesday, helping the index snap a three-day losing streak ahead of a key Fed meeting that will indicate the course of interest-rate hikes in the world’s largest economy.

The main bourse <.FTSE> was 0.4 percent higher by 0830 GMT, while the FTSE 250 fell 0.3 percent.

GlaxoSmithKline <GSK.L> jumped 7 percent to take the top spot on the FTSE 100 index after saying it would combine its consumer health business with Pfizer’s <PFE.N> in a joint venture with sales of 9.8 billion pounds ($12.41 billion).

GSK, which was on track for its best day in ten years, also said it plans to split into two businesses – one for prescription drugs and vaccines, the other for over-the-counter products.

Healthcare stocks were the biggest boost to the main index, with Shire <SHP.L> also adding 1.2 percent.

In the red on the FTSE 100 was postal services group Royal Mail <RMG.L>, down 3.7 percent after weak results from FedEx in the U.S. dented sentiment across the post and logistics sector.

Deutsche Post <DPWGn.DE> shares also fell 4.9 percent.

Dealmaking was also a driver among smaller stocks, with airline Flybe Group <FLYB.L> shooting 21 percent higher after Virgin Atlantic said talks about a potential takeover offer were ongoing.

Flybe has more than doubled in market value since Sky News broke the news on the takeover talks in late November – but the struggling airline has still sunk 43 percent this year as profit warnings took their toll on the share price.

On the Brexit front, the government said it would implement plans for a no-deal scenario in full, even as Prime Minister Theresa May is set to bring her divorce deal back to the parliament in mid-January.

(Reporting by Muvija M and Shashwat Awasthi in Bengaluru, Editing by Helen Reid)

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