Leading shares have slipped back after the victory in the Greek elections by anti-austerity party Syriza, but so far there has been no market meltdown.
The FTSE 100 is currently down just 4.12 points at 6828.71, and Mike van Dulken, head of research at Accendo Markets, said:
While [Syriza’s win] generates uncertainty based on strong desire to leave behind austerity and renegotiate/abandon current Trioika bailout conditions, as well as empower populist movements elsewhere in Europe, a slightly softer party rhetoric of late means losses are considered not as bad as they might have been.
Shire is one of the companies helping support the leading index. Its shares have gained 165p to £49.81 after NPS Pharma, which it is buying for $5.2Bn, had received approval from US regulators for its Natpara drug, designed to treat the rare disease hypoparathyroidism. In addition Shire’s Idursulfase-IT drug has received fast track designation from the US Food and Drug Administration for treatment of neurocognitive decline.
Jefferies said:
This positive outcome validates management’s calculated risk acquiring NPS only weeks ahead of this critical event. We are now consolidating NPS in our forecasts, boosting earnings per share by 6% and 10% in 2016 and 2017 and our price target up 5% to £58.
[Shire has] abundant pipeline catalysts. We expect FDA to approve Vyvanse for binge eating disorder around its 1 February PDUFA date based on impressive Phase III data and a Priority Review, with consensus typically undervaluing this commercial opportunity.
Perhaps Shire’s most important pipeline asset, lifitegrast for dry eye disease, is on-track for US regulatory filing in the first quarter of 2015. Results from numerous Phase II trials of SHP625 in rare cholestatic liver diseases are anticipated during 2015, with positive paediatric data potentially enabling 2016 filings. We are also cautiously optimistic on Premiplex to treat retinopathy of prematurity, with Phase II results in the second half of 2015 possibly sufficient for filing under a “best case” scenario.
British Airways owner International Airlines Group has climbed 18p to 554p after it raised its offer for Aer Lingus from €2.40 to €2.55 or €1.36bn.
SSE has announced it will be cutting household gas bills by 4.1% but news it planned to maintain its dividends has helped push the shares 27p higher to £15.19.
But mining shares are weighing on the market, with BHP Billiton down 41p at £13.84 and Anglo American off 31.5p at £10.72. Glencore has fallen 6.45p to 242.95p after Japanese peer Marubeni halved its profit outlook.
Tullow Oil has dropped 10.5p to 360.8p after analysts at BMO cut their recommendation from outperform to market perform. The continuing weakness in the oil price - Brent crude is currently down 1.74% at $47.94 a barrel - has not helped.
