TMCnet News
GSK profits warning curbs FTSE 100 rally [Herald, The (Scotland)](Herald, The (Scotland) Via Acquire Media NewsEdge) A PROFITS warning from GlaxoSmithKline curtailed a rally for the FTSE 100 Index as shares in the pharmaceuticals giant slid by nearly five per cent. The FTSE 100 Index finished 2.8 points higher at 6798.1, having earlier made headway on the back of gains for Vodafone and outsourcing firm Capita. Markets have recovered in recent sessions on signs of an easing in tensions between Russia and the West over the downing of a passenger jet in Ukraine. The pound slipped against the dollar, at 1.70, and held steady against the euro, at 1.27, after the latest minutes from the Bank of England showed that low wage growth prevented members from considering a first rates hike in five years. GlaxoSmithKline declined almost 73.5p to 1481.5p after it reported a 22 per cent decline in half-year operating profits to pound(s)2.94 billion and warned that earnings per share in 2014 were now likely to be flat this year. Shares slumped on the downgrade as the company also highlighted the impact of the stronger pound on prospects for its share buy- back programme. The company's performance continues to be hit by falling drug and vaccine sales in the United States, driven by competition from generic products. Vodafone did its best to prop up the London market after former US partner Verizon reported a bigger-than-expected surge in second quarter revenues as it benefits from strong demand from wireless customers. US stocks ended mostly higher yesterday, with the S&P 500 closing at a record on Apple's bullish results, though Boeing weighed on the Dow and conflicts in Ukraine and the Gaza Strip kept the broader market's gains in check. Biotech stocks ranked among the day's biggest gainers, boosted by some strong results and drug trial data. The Nasdaq Biotech index jumped 2.2 per cent in its fourth consecutive day of gains. Apple gave one of the biggest lifts to the market, rising 2.6 per cent to $97.19 as concerns faded about its margins. Microsoft rose 0.1 per cent to $44.87 after the company said it aimed to get its money-losing Nokia phone unit to break even within two years. Among the companies that reported results after the market closed, Facebook posted stronger-than-expected revenue growth and its stock climbed 3.5 per cent to $73.80 in extended-hours trading. TripAdvisor shares tumbled 9.4 per cent to $97.25 in after-hours trading after the travel website company reported earnings that missed expectations. The shares of Dow component AT&T slipped 1.4 per cent to $35.38 in extended-hours trading after it reported revenue that missed analysts' forecasts. While the S&P 500 ended at a record close, the Dow was kept under pressure by Boeing, which fell 2.3 per cent to $126.71. It reported a 52 per cent jump in quarterly profit, but investors were spooked by rising costs. PepsiCo rose 1.9 per cent to $90.82 after it reported a higher- than-expected quarterly profit and raised its full-year adjusted earnings forecast. (c) 2014 ProQuest Information and Learning Company; All Rights Reserved. |