London midday: Stocks extend gains as pharmaceuticals rally
By Michele Maatouk
Date: Wednesday 01 Oct 2025
(Sharecast News) - London stocks had extended gains by midday on Wednesday, hitting a new record high amid strength in the pharmaceutical sector, as investors mulled a shutdown of the US federal government.
The FTSE 100 was up 0.7% at 9,415.30.
Richard Hunter, head of markets at Interactive Investor, said: "Washington may have turned the lights out, but investors bypassed the political noise to send the Dow Jones to a new record high.
"Nonetheless, there are some implications which are difficult to avoid, such as the possibility of mass layoff of federal workers which would put extra strain on an already anaemic labour market. Apart from the fact that the non-farm payrolls report may not now be released on Friday, which hampers the Fed's visibility on the latest state of play, any shutdown lasting more than the usual couple of weeks would leave some shifting uncomfortably in their chairs.
"In the meantime and by default, other employment data takes on extra significance. The job openings report yesterday highlighted weakness in hiring new staff, while today's ADP report could highlight further weakness with the addition of a modest 50,000 jobs expected."
On home turf, a survey showed that activity in the manufacturing sector contracted at the fastest pace in five months September.
The S&P Global manufacturing purchasing managers' index dropped to 46.2 from 47.0 in August, remaining below the 50.0 mark that separates contraction from expansion for the twelfth month in a row.
S&P noted that four of the five PMI components - output, new orders, employment and stocks of purchases - were consistent with a deterioration in operating conditions.
Manufacturing production declined for the eleventh month in a row in September, at the fastest pace since March, with the consumer, intermediate and investment goods sectors all seeing output fall at solid rates.
Manufacturers said production had been scaled back due to weaker intakes of new business, with demand from both domestic and export markets weak.
The survey also found that new order intakes subsequently fell for the twelfth month in a row, and to one of the greatest extents in the past two years.
This was put down to subdued client confidence, US tariff uncertainty and the consequences of a high cost backdrop, in particular for energy and staff. There were also reports that automotive supply chains disrupted due to production shutdowns at Jaguar Land Rover.
Meanwhile, the latest data from Nationwide showed that house prices nudged higher in September, as the market continued to shake off wider economic uncertainty.
In equity markets, pharmaceuticals were the standout gainers, with AstraZeneca, Hikma, GSK and Haleon all higher.
The gains came after Pfizer struck a deal with US President Donald Trump to cut US drug prices. As part of the deal, in exchange for Pfizer committing to a $70bn investment in manufacturing and research in the US, it will be exempt from pharmaceutical tariffs for three years.
Trump announced plans on Tuesday to launch a government-run website, dubbed TrumpRx, for consumers to buy drugs directly from manufacturers.
JPMorgan said in a research note: "Overall, we see Pfizer's agreement on Most Favoured Nation as a potential bellwether for the sector which, we anticipate is likely to be replicated by EU Pharma companies and should therefore result in a broadly manageable impact from MFN on EU Pharma, reassuring investors."
Russ Mould, investment director at AJ Bell, said: "It looks like investors are regaining confidence in the pharma sector following recent uncertainty around pricing and tariffs. More clarity on both points is helping to regain investors' interest."
JD Sports advanced after Nike's first-quarter earnings beat expectations.
Greggs surged as the bakery chain Greggs reported a slowdown in sales, pinning the blame partly on a "heat-affected" July, but reiterated its outlook for the full year.
Dan Coatsworth, head of markets at AJ Bell, said: "The fact life hasn't got any worse for Greggs was enough to breathe some life into the share price. It says trading has improved over the past few months, it is getting cost pressures under control, and full-year guidance has been maintained.
"Don't be fooled into thinking the king of sausage rolls is sitting upright on its throne, with nothing to worry about. The share price jump is a mixture of relief and a short squeeze, not a celebration of significant progress."
He said LFL sales are "still pedestrian" and there is "a nagging feeling that Greggs is growing too fast in the face of fierce headwinds".
Taylor Wimpey was little changed as the housebuilder reiterated its guidance for 2025 after a "robust" sales performance over the third quarter, but said it was mindful of various issues currently affecting customer sentiment, such as the impact of the delayed autumn budget.
Tate & Lyle tanked as it downgraded its full-year profit and revenue expectations, while Howden Joinery fell after shareholder Invesco Asset Management placed about 20.1m shares in the company at 825p each.
Market Movers
FTSE 100 (UKX) 9,415.30 0.69%
FTSE 250 (MCX) 21,991.77 -0.11%
techMARK (TASX) 5,486.82 0.62%
FTSE 100 - Risers
AstraZeneca (AZN) 11,884.00p 6.28%
Hikma Pharmaceuticals (HIK) 1,765.00p 3.95%
JD Sports Fashion (JD.) 98.34p 3.19%
GSK (GSK) 1,618.50p 2.79%
Croda International (CRDA) 2,776.00p 2.66%
Burberry Group (BRBY) 1,199.00p 2.65%
Intertek Group (ITRK) 4,836.00p 2.41%
Spirax Group (SPX) 6,975.00p 2.35%
Diageo (DGE) 1,810.50p 1.97%
Smurfit Westrock (DI) (SWR) 3,169.00p 1.70%
FTSE 100 - Fallers
Babcock International Group (BAB) 1,292.00p -2.86%
Flutter Entertainment (DI) (FLTR) 18,840.00p -2.59%
Imperial Brands (IMB) 3,090.00p -2.15%
Rolls-Royce Holdings (RR.) 1,165.00p -2.10%
Tesco (TSCO) 437.60p -1.77%
Entain (ENT) 858.80p -1.72%
Coca-Cola HBC AG (CDI) (CCH) 3,444.00p -1.71%
BAE Systems (BA.) 2,026.00p -1.60%
Auto Trader Group (AUTO) 776.80p -1.45%
Persimmon (PSN) 1,144.00p -1.29%
FTSE 250 - Risers
Greggs (GRG) 1,719.00p 7.17%
Discoverie Group (DSCV) 610.00p 2.69%
Hochschild Mining (HOC) 362.80p 2.08%
AO World (AO.) 105.80p 1.93%
Travis Perkins (TPK) 622.00p 1.88%
Ithaca Energy (ITH) 200.15p 1.60%
Frasers Group (FRAS) 754.50p 1.55%
Pets at Home Group (PETS) 207.80p 1.46%
Raspberry PI Holdings (RPI) 414.50p 1.39%
International Workplace Group (IWG) 226.20p 1.34%
FTSE 250 - Fallers
Tate & Lyle (TATE) 406.40p -9.61%
QinetiQ Group (QQ.) 532.50p -3.09%
Marshalls (MSLH) 176.20p -2.54%
AJ Bell (AJB) 529.00p -2.31%
Howden Joinery Group (HWDN) 825.50p -2.13%
Morgan Sindall Group (MGNS) 4,355.00p -1.91%
W.A.G Payment Solutions (EWG) 96.00p -1.84%
Anglo-Eastern Plantations (AEP) 1,355.00p -1.81%
Premier Foods (PFD) 188.60p -1.77%
Aston Martin Lagonda Global Holdings (AML) 80.95p -1.76%
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN