Market Report: Hikma Pharmaceuticals provides a glimmer of interest in a day of lacklustre trading


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The Independent Online

Hikma Pharmaceuticals, the Jordanian generic drug maker which entered the FTSE 100 in March, provided a glimmer of interest in a day of lacklustre trading. Hikma strengthened by 44p to 2,054p, after analysts at Stifel raised their recommendation to “buy” from “hold” with a 2,300p price target.

Although litigation regarding its generic version of gout medicine colchicine has been resolved, sales of the treatment have been slow to take off, according to the broker.

Still, Stifel is forecasting a continuing strong performance in the longer term, as well as from the generic injectables business, saying: “We believe large acquisitions are possible in the near future and will remain an integral part of Hikma’s business plan.”

The FTSE 100 index of leading shares put on an anaemic performance in the first session of the post-election week, ending the day down 16.97 at 7,029.85.

Royal Mail led the blue chip gainers, boosted by news that Whistl – one of its main competitors in the door-to-door mail delivery service – has suspended its rival business. Royal Mail jumped by 18.7p to 497.6p as the market digested news that 2,000 Whistl staff have been sent home from depots in Manchester, Liverpool and west London, after talks regarding further funding for the business were halted.

A brace of broker recommendations provided colour elsewhere, with Intercontinental Hotels under the cosh – shedding 37p to 2,783p – after Exane BNP Paribas slashed its price target by 11 per cent to 2,550p, rating the stock an “underperform”, while Sage was in the ascendant after Goldman Sachs lifted the  price target on the software group to 565p from 540p. It gained 12.5p to 556p.

Engineering group Spirax-Sarco was among the mid-cap losers, shedding 213p to 3,329p after a trading update ahead of its AGM yesterday.

The group, which specialises in the efficient use of steam, said that lower growth in Asia and the Americas impacted its performance at the start of the year, but it still expects to make “further progress” in 2015.