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Market Report: US pill poppers are 'healthy' for Shire

Lucy Tobin
Wednesday 01 August 2012 20:46 BST
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Parents whose kids have ADHD might not see soaring rates of diagnosis of the attention-deficit disorder as a good thing, but Shire, the pharma giant that makes the majority of the pills used by sufferers certainly does.

"Healthy growth" is how it described the US market for ADHD products yesterday, explaining the reason for its soaring sales of Vyvanse and Intuniv pills for ADHD. They helped Shire beat market expectations with a 14 per cent rise in second-quarter revenues to $1.2bn (£769.4m).

"Both increased share and we're advancing our plans for the continued international rollout of both these products," said Shire.

Phew, said the City since the drugmaker's ADHD franchise was hit in June when US regulators approved a cheaper rival version of one of its key ADHD treatments, Adderall XR. Shares rose 4.82 per cent or 89p to 1937p.

Elsewhere, the rise in property porn gave Rightmove a boost. Despite house prices falling in July for the fourth time in five months, according to figures from Nationwide yesterday, and Bank of England lending data this week showing mortgage approvals dropped to an 18-month low in June, nosy Normas desperate to find out how much their neighbours' homes are being bought and sold for helped Rightmove's pre-tax profit jump 35 per cent to £38.9m in the first six months of the year. More surfers on the company's website meant more advertisers. The City reckons the trend will continue and the shares took a ride accordingly. Rightmove was up by 10 per cent, or 153p, to 1645p.

Overall, though, volumes remained desultory. "Lightweight," said one thumb-twiddling trader. "No major trades at all, with little going on in equities, the more intelligent of our clientele are thinking outside the box, looking at corporate bonds paying good coupon rates, because there's so little going on here.

"Thank God for the Olympics – at least it means that there's something to pass the time."

One sport they weren't watching was the tug of war – contested at every Olympic Games between 1900 to 1920 before being axed. But it was clearly in evidence in the FTSE 100, as the battle for supremacy between gloomy eurozone-worriers and China-watchers and the everything-will-be-OK buyers continued.

Fears that the European Central Bank may not deliver enough stimulus this week to tackle a global economic slowdown were ignored.

The FTSE 100 ticked up 77.54 points or 1.4 per cent to 5,712.82 despite numbers from China overnight showing official factory purchasing managers' index fell to an eight-month low last month, suggesting the sector is barely growing. Analysts argued that the worse-than-expected numbers would inspire economic stimulus from the government.

As Mike McCudden, head of derivatives at Interactive Investor, put it: "Equities enjoyed a bounce after Chinese PMI data disappointed and triggered a fresh round of stimulus chatter."

BT, the official telecoms provider of the Olympics, edged up 1.5p to 218.8p after analyst Jerry Dellis at Jefferies issued a buy note saying its "retail recovery is firmly on track".

Elsewhere, retailers took a ride on Next's coat tails. The supplier of grey suits and other uniforms for the office classes raised its profit guidance thanks to surging demand at its website. Its shares rose more than 6 per cent or 208p to 3427p, whilst Marks and Spencer picked up 1.8p to 335.5p, and Debenhams gained 2.15p to 94.1p.

Avocet Mining warmed up 9.6p to 84.6p after a glowing note from stockbrokers at Numis, who raised their price target to 115p .

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