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Astra drives FTSE higher as Pfizer waits in wings

Astra drives FTSE higher as Pfizer waits in wings

Healthcare stocks have led the running in early trading on the FTSE 100, with shares in AstraZeneca (AZN) rising on speculation US rival Pfizer (PFE.N) may make another bid for the pharmaceutical giant.

The UK blue-chip index added 19 points, or 0.3% to trade at 6,775. AstraZeneca rose 1.7% to 43.57 as investors bet Pfizer could return with another takeover approach. Pfizer made a series of failed bids for the company earlier in the year, and under takeover rules can make the first steps towards a new bid next week.

Fellow pharmaceutical group GlaxoSmithKline (GSK) rose 1.4% to £14.37 while medical equipment manufacturer Smith & Nephew (SN) rose 1.1% to £10.58.

Miners again performed poorly, after fresh concerns over growth of top metals consumer China emerged. Growth in the country’s factory sector slowed to a three-month low in August, new data revealed.

Fresnillo (FRES) was the biggest faller, dropping 3.4% to 939.5p, while Randgold Resources (RRS) dipped 1.4% to £49.26 and Rio Tinto (RIO) traded 0.5% lower at £34.40.

On the AIM market, Quindell (QPP) fell 4.4% to 201p after announcing profit nearly tripled in the first half of the year. However, much of the headline news from the results had already been delivered in the insurance claims outsourcing firm’s pre-close statement.

Quindell has endured a tumultuous 2014 after an attack from short selling group Gotham City Research, with its shares losing two-thirds of their value since hitting a peak of 660p in February.

The pound is meanwhile trading 0.1% down at $1.6577 after weak retail sales data. Retail sales volumes in July were up just 0.1% on the month, and 2.6% year-on-year, while the average price of goods in the month was 0.9% down on the same time last year.

'The significant year-on-year deflation in the retail sector reflects the strong competition among retailers and confirms there are no substantial inflationary pressures in the economy,' said David Kern, chief economist at the British Chambers of Commerce.

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