U.K. stocks were little changed, following four days of losses, as economic reports in the U.S. missed forecasts, offsetting rallies by GlaxoSmithKline Plc (GSK) and Vodafone Group Plc. (VOD)
GlaxoSmithKline rose to its highest price since 2002 after a regulatory panel recommended its lung-disorder drug for approval. Vodafone gained 1.7 percent after Verizon Communications Inc. (VZ:US) said it still wants to buy out the British company’s stake in their wireless joint venture in the U.S. Eurasian Natural Resources Corp. slid 4.3 percent, pacing a decline by commodity producers.
The FTSE 100 Index (UKX) fell 0.5 point, or less than 0.1 percent, to 6,243.67 at the close in London, paring a gain of as much as 0.5 percent as the Federal Reserve Bank of Philadelphia’s general economic index missed forecasts. The equity benchmark has still climbed 5.9 percent this year. The broader FTSE All-Share Index added less than 0.1 percent today, while Ireland’s ISEQ Index slipped 0.2 percent.
“The Philly Fed is indicating a slowdown in growth in the manufacturing sector, which is taking away some of the recent optimism among investors towards U.S. growth,” said Espen Furnes, a fund manager who helps oversee $75 billion at Storebrand Asset Management in Oslo, in a message. “Overall, investors are cautious ahead of the big wave of earnings coming in the next weeks.”
In the U.S., the Philadelphia Fed’s index fell to 1.3 in April from 2 in March. Readings greater than zero mean that manufacturing expanded in the area covering eastern Pennsylvania, southern New Jersey and Delaware. The median forecast of economists surveyed by Bloomberg had called for a reading of 3.
A Labor Department report showed initial jobless claims rose to 352,000 in the week ended April 13, from a revised 348,000 a week earlier. The median estimate of economists in a Bloomberg survey had called for the number of people seeking unemployment benefits to reach 350,000.
A separate release showed the Conference Board’s index of leading indicators unexpectedly dropped 0.1 percent in March. Economists had forecast the gauge, which measures the outlook for the next three to six months, would gain 0.1 percent. It climbed 0.5 percent in February.
GlaxoSmithKline climbed 3.2 percent to 1,658 pence. A panel of advisers to the U.S. Food and Drug Administration recommended that Breo Ellipta, which Glaxo has developed with Theravance Inc., should get approval to treat chronic obstructive pulmonary disease. The FDA will probably decide whether to approve the treatment by May 12.
Vodafone added 1.7 percent to to 192.5 pence. Verizon Chief Financial Officer Fran Shammo said in a conference call his company, which owns 55 percent of Verizon Wireless, remains interested in buying the 45 percent stake that Vodafone owns. The second-largest U.S. phone company posted first-quarter earnings of 68 cents a share, exceeding the average analyst estimate (VZ:US) of 65 cents in a Bloomberg survey.
Debenhams Plc (DEB) surged 4.9 percent to 84.45 pence, its biggest rally since Oct. 25, after the U.K.’s second-largest clothing retailer reported fiscal first-half profit before taxes of 120.3 million pounds ($184 million), in line with its March 4 forecast of 120 million pounds. The department-store owner will pay an unchanged interim dividend of one penny a share.
Debenhams on March 4 tumbled the most since 2008 after warning in an unscheduled statement that profit would miss analysts’ estimates because snow in January hurt its sales.
GKN Plc (GKN) advanced 2.6 percent to 252 pence after the supplier of parts to Boeing Co. and Airbus SAS airplanes said first-quarter sales rose 9 percent to 1.89 billion pounds.
“We continue to expect 2013 to be a year of good progress,” the company said in a statement.
ENRC (ENRC) retreated 4.3 percent to 229.8 pence. The U.K.’s Serious Fraud Office demanded documents from Dechert LLP, the law firm fired by the mining company earlier this month, the Financial Times reported, citing unnamed people familiar with the matter. ENRC said on April 11 that it had hired Fulcrum Chambers LLP to replace Dechert.
Kazakhmys Plc (KAZ), which owns a 26 percent stake in ENRC, slid 3.1 percent to 310.1 pence.
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