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FTSE100 slips into the red after US jobs report; Woodford boost for GSK

UK shares finished lower after the US jobs report and as the oil price continues to weigh.
FTSE100 slipped into the red as the US jobs number failed to inspire...

When Neil Woodford talks, the market tends to sit up and take notice.

And so was with GlaxoSmithKline. His assessment is the £69bn drugs Behemoth is too unwieldy in its current form and therefore should be split up. It is four companies in one, he reckons, and none of the businesses is doing a decent job.

Woodford is a stocks guru and about the closest thing we have to a personality in the UK investment industry.

Over a quarter of a century his Invesco Perpetual Fund would have turned £1,000 into £23,000. Since then he’s struck out on his own with the Woodford Equity Income fund and the Patient Capita Trust.

You can bet if Woodford is opining on GSK, then others big wheels in the Square Mile are probably thinking along the same lines. No doubt some enterprising banker has run the numbers showing the value to be liberated from a split.

Glaxo shares rose 27p or 2% to 1,371.5p, adding a further £1.3bn to the value of Glaxo.

Its advance was not enough to prevent a further slide of FTSE 100, which has tumbled over 5% this week amid fears about China’s economic slowdown and the growing tensions in the Middle East. After spending most of the day in positive territory, the index closed down 41.64 points at 5,912.44 as investors fretted over a second US rate rise in as many months.

UK shares slipped into the red and finished lower after the US jobs report failed to light the touchpaper and as the oil price continues to weigh.

The FTSE100 continues to be below 6,000 and finished down 42 at 5,912.

 FTSE250 was also down - around 60 points at 16,732.

Brent crude fell 1.45% to US$34.02 a barrel as the global oil market continues to take a hit.

The biggest laggard on Footsie was sportswear seller Sports Direct (LON:SPD) , which dropped over 15% to 433.3p after a profits warning.

Miners were also, unsurprisingly under the cost, with Anglo American (LON:AAL) dropping 4.76% to 230.2p and BHP Billiton (LON:BLT) shedding 3.21% to 652.10p.

Tesco (LON:TSCO) was top dog - up 5.53% to 147.05p as Barclays upgraded to an “overweight” rating from “equal weight”.

The keenly watched jobs report from across the Pond threw up a mixed bag.

It showed  US employers added 292,000 jobs in December last year,beating consensus estimates of 200,000 by a long chalk but average hourly earnings rose less than anticipated - a sign of the strength or lack-of of the  economy.

Chris Beauchamp, analyst at IG Index, said: "Equity traders have been left bereft of reasons to be optimistic this week, and it looks like the China fears of the past few days will remain with us as we head into a new week.

"US job numbers kicked off 2016 in fine form, well ahead of estimates, but the lack of wage growth was the fly in the ointment."

In small caps, Corero Network (LON:CNS) shares surged 32.53% to 27.5p on news that options were granted over new ordinary shares to the directors this week.

Green energy firm React LON:REAC) shot up 25% to 3.75p after it secured a €750,000 loan from EBIOSS Energy, a Spanish company that is providing technology for the Newry biomass project in Northern Ireland.

Software company Sopheon (LON:SPE) rose over 15% to 72.5p after it said the second half of the year had exceeded expectations, meaning earnings [EBITDA] and pre-tax profit would be ahead of previous hopes.


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