London FTSE 100 slips as GSK shares fall on Nuvalent deal

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FTSE 100 slips as GSK shares fall

Highlights

FTSE 100 slips 0.3% to 10,341 points as GSK drops 2.8% after announcing plan to acquire Nuvalent to boost cancer treatments.
GSK’s drop drives FTSE 350 Pharmaceuticals and Biotechnology index down 1.6%, while Molten Ventures jumps 9.5% and Fever-Tree Drinks rises 6.4% on positive updates.
Investors price in a 25 basis point Bank of England rate hike for September amid inflation worries from higher energy costs and limited UK exposure to AI stocks.

GSK deal weighs on London trading

As reported by Reuters, the FTSE 100 falls 0.3% to 10,341 points by 0810 GMT, while the FTSE 250 rises 0.2%. GSK shares drop 2.8% after the company says it plans to acquire Nuvalent to strengthen its lung cancer treatment portfolio.

The decline in GSK also pushes the broader FTSE 350 Pharmaceuticals and Biotechnology index down 1.6%, making it the weakest-performing sector in early trading. Elsewhere, BP slips 1%, tracking lower crude prices, while attention remains on the company after the dismissal of former chair Albert Manifold and questions over the circumstances of his departure.

Among individual movers, Molten Ventures jumps 9.5% after reporting annual results. Fever-Tree Drinks gains 6.4% after saying it is confident of meeting full-year market expectations for revenue and core profit and announcing a higher share buyback, while homebuilder MJ Gleeson loses 3.5% after forecasting annual adjusted pretax profit below market expectations.

Middle East tensions and rate expectations in focus

Investors are also watching signs of de-escalation in the Middle East after Iran and Israel say they have halted attacks on each other following an appeal from U.S. President Donald Trump. Trump also says he could have "an idea" for an Iran deal within a few days.

Higher energy costs linked to the conflict have added to inflation concerns, with investors pricing in a 25 basis point Bank of England rate hike in September, according to LSEG-compiled data. Against that backdrop, UK equities continue to lag peers in Asia and the U.S., reflecting their limited exposure to AI stocks, even as Britain sets out a new 1.1 billion pound plan to expand domestic AI computing capacity.

Our earlier article on GSK’s talks to acquire Nuvalent outlined a potential $9–$10 billion deal aimed at bolstering the company’s oncology pipeline, with Nuvalent’s lung-cancer candidate facing a key FDA decision in September. We noted that the move would be GSK’s biggest acquisition in more than a decade and part of a broader rebound in biotech M&A as large drugmakers seek new growth assets.

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