October 18, 2018 / 10:14 AM / 10 months ago

Healthcare stocks lift FTSE 100, while Unilever slips after results

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* FTSE 100 up 0.2 pct

* CRH tumbles after weak Heidelbergcement results

* Unilever declines as volume miss overshadows sales growth

By Josephine Mason and Helen Reid

LONDON, Oct 18 (Reuters) - Britain’s top share index eked out small gains on Thursday as strong earnings helped lift healthcare stocks, offsetting falls in construction materials’ companies and in consumer giant Unilever after disappointing results.

The market broadly shrugged off weaker UK retail sales data which showed a slump in spending, particularly on food, after a hot summer during which Britons splurged on barbecues and outdoor activities.

The FTSE 100 was up 0.2 percent by 0954 GMT.

The healthcare sector was the biggest boost, with UK-listed drugmakers buoyed after Switzerland’s Novartis raised its 2018 revenue forecast and announced a $2.1 billion acquisition of nuclear medicine specialist Endocyte.

GlaxoSmithKline was up 1.9 percent and Shire climbed 1.3 percent.

Education publisher Pearson was the second-largest gainer on the FTSE, rising 3.7 percent and extending the previous day’s rally.

Analysts from Morgan Stanley and Deutsche Bank were among those who increased their price targets following Pearson’s well-received trading update on Wednesday.

Shares in advertising agency WPP gained 2.7 percent after French rival Publicis’ stronger trading update relieved some investor anxiety around the challenges facing traditional advertising firms.

Consumer giant Unilever was among the biggest drags on the index, its shares down 1.2 percent as analysts and investors focused on weaker-than-expected volume growth overshadowing better sales growth.

“While these results are solid enough, they’re not quite the stellar showing investors would have been looking for,” said George Salmon, equity analyst at Hargreaves Lansdown.

UBS analysts said Unilever would need to deliver at least 3.1 percent sales growth in the fourth quarter in order to meet the lower end of its full-year guidance.

“We think this is achievable, but it heightens the risk of a guidance miss if market conditions deteriorate,” they wrote.

A disappointing outlook from German cement maker Heidelbergcement dragged CRH lower, weighing on basic materials stocks.

Overall, analysts are downgrading their earnings estimates for the FTSE 100 as well as the mid-cap FTSE 250 index, which was up 0.3 percent with some sharp results-driven moves.

Domino’s Pizza Group topped the FTSE 250 with an 8.9 percent gain after it launched a 25 million pound ($33 million) share buyback.

“This is lower than the previous buyback of 50 million pounds, albeit it does at least mean that the group’s leverage ratio will be less stretched than if a large buyback was announced,” wrote Barclays analysts.

The UK franchise of Domino’s Pizza Inc also reported a 6 percent rise in organic sales thanks to a rise in website and app orders.

Games Workshop shares fell 8.7 percent after the manufacturer of Warhammer figurines warned of “uncertainties” for the rest of the financial year in a trading statement.

“A very shortly worded update paints a dark picture for the future,” said Russ Mould, investment director at AJ Bell.

“A lack of detail is surprising given Games Workshop has developed a reputation for being a very clear communicator in its results.”

Bus travel company National Express, on the other hand, climbed 4 percent after giving a positive outlook and reporting that strong UK and Spanish trading boosted profit.

Peer Stagecoach Group also rose, by 3.1 percent. ($1 = 0.7619 pounds)

Reporting by Josephine Mason and Helen Reid Editing by Susan Fenton

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