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London stocks edge up on upbeat AstraZeneca earnings


London stocks rise on upbeat AstraZeneca results; BOJ stokes rate worries By Reuters

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Published Jul 28, 2023 08:29
Updated Jul 28, 2023 09:35

© Reuters. FILE PHOTO: The London Stock Exchange Group offices are seen in the City of London, Britain, December 29, 2017. REUTERS/Toby Melville/File Photo

By Shubham Batra and Sruthi Shankar

(Reuters) -British equities edged higher on Friday on strong gains in the pharmaceutical sector driven by upbeat quarterly results from AstraZeneca (NASDAQ:AZN), although surprise Bank of Japan’s yield control policy tweak spurred worries of higher interest rates.

The blue-chip FTSE 100 added 0.2%, hovering around its highest level in nine weeks. Meanwhile, the midcap FTSE 250 index fell 0.5% after rising for three consecutive sessions.

The biggest gainer on the FTSE was the pharmaceutical sector, which jumped 2.5% after AstraZeneca beat expectations for its second-quarter profit. The stock climbed 4.0%.

The biopharmaceutical company also said on Friday its unit Alexion (NASDAQ:ALXN) has agreed to buy U.S. drugmaker Pfizer (NYSE:PFE)’s early-stage rare disease gene therapy portfolio for up to $1 billion, plus royalties on sales.

Rate-sensitive real estate sector lost 0.5% as UK 10-year gilt yield rose to 4.392%, its highest since July 18, after the BOJ tweaked its yield control policy during its monetary policy review.

The BOJ maintained its ultra-low interest rates but shifted slightly on yield curve control, saying its 0.5% limit on 10-year government bond yields was now a “reference” and offered to buy such bonds at 1% in the market instead.

“”We think the move is an acknowledgement of the changing macro environment and effectively raises the upper bound limit,” said Mark Haefele, chief investment officer, UBS Global Wealth Management.

Standard Chartered (LON:STAN) Plc rose 6.2% after the Asia-focussed lender upgraded its annual profit forecast and set a new $1 billion share buyback after a strong first-half performance.

Crisis-hit NatWest (LON:NWG) added 0.1% after the lender posted forecast-beating first half profit as it reels from the abrupt departure of its CEO Alison Rose over a public spat with former Brexit party leader Nigel Farage.

British Airways (LON:ICAG) operator IAG gained 2.5% as its quarterly profit beat analyst forecasts by 40% and it said it was encouraged by the outlook for the summer.

London stocks rise on upbeat AstraZeneca results; BOJ stokes rate worries

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