Market report: Tuesday close

By MICKEY CLARK FOR MAILONLINE
Updated:

 

SHARES of the two big drugs companies were back on investors' shopping lists. GlaxoSmithKline rose 17p to 1211p after several players in the City threw their weight behind the group and begun pushing it to their clients.

Smith Barney has given the shares an outperform rating and raised its earnings estimates despite worries about growing competition from cheap drugs. UBS has repeated its neutral rating on GSK but has raised its target price by 50p to 1300p.

Meanwhile, AstraZeneca put on 16p at 2489p awaiting final approval from the US Food and Drug Administration over dosage levels for its fat-busting drug Crestor. AZ wants permission to administer the drug at higher dosage levels despite concerns about its safety.

The rest of the market traded in a narrow band again, affected by holiday influences. The FTSE 100 index rose 8.9 points to 4185.6 as Wall Street opened to modest gains.

Anglo American, struggling for control of gold miner Ashanti, firmed 15 1/2p to 1140 1/2p after Deutsche Bank told clients to buy and raised its target price from 1065p to 1210p. The offer of £680m for Ashanti by Anglo's 51%-owned Anglogold has been topped by Randgold, up 80p at 1350p. Dealers say AA must decide if it wants to become embroiled in an expensive auction for Ashanti.

Whitbread fell 4p to 742p even though UBS has repeated its buy rating on the shares and increased its 12-month target price from 822p to 875p.

Scottish & Newcastle lost 13p to 388p. ABN Amro says the shares are looking expensive. UBS has downgraded Intercontinental Hotels, up 1/2p at 500 1/2p, from buy to neutral while retaining its price target of 529p. It has initiated coverage of Balfour Beatty, 1 1/2p better at 188p, with a buy rating and price target of 222p.

HIT Entertainment, 13 1/2p off at 256p, continued to reel from Monday's downgrade by house broker Merrill Lynch from buy to neutral. It warned of declining sales of merchandise for its hit children's TV programme Bob the Builder.

Aviation supplier Smiths Group gained 1/2p at 711p despite Deutsche Bank shaving its profits estimate for 2003-04 by 7% following a meeting with the company. Trading this year appears to be largely unchanged, said Deutsche.

Lossmaking IT recruitment agency MSB International, up 7 1/2p at 73 1/2p, has severed ties with finance director Douglas Adshead-Grant less than a year after he took on the role. The company said Adshead-Grant's departure was mutually agreed and would not comment further. He joined MSB in November prior to the company issuing two profit warnings. MSB posted a pre-tax loss of £421,000 for the year to 31 January.

The Daily Mail's Laurie Laird on yesterday's trade
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