London’s FTSE 100 rose on Wednesday as investors assessed the U.S. government shutdown, with healthcare stocks emerging as the top performers after Pfizer’s drug-pricing deal with Washington eased policy uncertainty.
As of 12:31 GMT, the blue-chip index FTSE 100 gained 0.6% and the British GBP/USD rose 0.5% against the dollar to 1.35.
DAX index in Germany rose 0.3%, the CAC 40 in France gained 0.4%.
Healthcare stocks rally as Pfizer strikes drug pricing deal with Trump
Industry leaders AstraZeneca PLC (ST:AZN) rallied 7.2%, Hikma Pharmaceuticals PLC (LON:HIK) rose over 5%, and GSK plc (LON:GSK) gained 2.9%, moving in tandem with their European counterparts.
The sector’s strong performance follows an agreement between Pfizer Inc (NYSE:PFE) and President Donald Trump, announced Tuesday, where the U.S. drugmaker agreed to lower prescription drug prices in the Medicaid program in exchange for tariff relief. Pfizer shares closed 6.8% higher on Tuesday.
The broader European healthcare stocks also gained. Among European healthcare companies, Ambu A/S (CSE:AMBUb) jumped 10%, Sartorius AG (F:SATG) gained over 11%, while Merck KGaA (ETR:MRCG) and Roche Holding AG (SIX:RO) added 6.7% and about 7% respectively.
In company news, Greggs PLC (LON:GRG) shares climbed more than 7% after the bakery chain reported total sales growth of 6.1% year-on-year for the 13 weeks to September 27, with like-for-like sales in company-managed shops increasing 1.5%. Year-to-date, total sales were up 6.7% with like-for-like sales rising 2.2%. Meanwhile, Tate & Lyle PLC (LON:TATE) shares tumbled more than 10% after the food ingredients maker warned that full-year profit and revenue will decline due to weak demand in the Americas and additional pressure in Europe. The company now expects revenue and EBITDA for the year to March 31, 2026, to fall by low single digits at constant currency. On the economic front, UK manufacturing conditions deteriorated further in September, with the S&P Global UK Manufacturing Purchasing Managers’ Index falling to a five-month low of 46.2, down from 47.0 in August. The index has remained below the neutral 50.0 mark for twelve consecutive months, indicating a sustained contraction in the sector. British house prices rose 0.5% in September, slightly faster than expected, after dropping 0.1% in August, according to mortgage lender Nationwide Building Society. Bank of England rate-setter Catherine Mann stated Wednesday that UK monetary policy remains loose relative to inflation and economic activity. In a Bloomberg TV interview, Mann indicated that keeping interest rates on hold is "appropriate for the current period" while cautioning against tightening policy. Mann expressed concern about inflation expectations, noting: "There is drift in inflation expectations, and that’s a very important ingredient in my thinking about the persistence of the inflation."
