London's FTSE 100 index traded lower in early Thursday trading, pressured by a significant decline in pharmaceutical giant AstraZeneca, while the FTSE 250 managed to post gains, creating a split in the UK equity market.
AstraZeneca shares plummeted almost 9% after its drug Wainua, developed in partnership with Ionis Pharmaceuticals, failed to meet its primary endpoint in a major late-stage study for transthyretin-mediated amyloid cardiomyopathy, a rare heart disease. The drug did not reduce cardiovascular deaths or recurring heart issues, a setback for the company's ambitions in the space. Despite the disappointment, Sharon Barr, AstraZeneca's executive vice president for biopharma R&D, noted that the data still "support greater scientific understanding" of the condition.
The miss reshapes investor expectations in a market where Pfizer is the dominant player. Pfizer generated approximately $6.4 billion in 2025 from Vyndamax and other ATTR-CM drugs, according to a Reuters report in April. This highlights why the market closely watched AstraZeneca's hopes for Wainua beyond its current approval for nerve disease.
Healthcare stocks showed mixed performance. GSK drew attention after Alector announced that the UK pharma giant had withdrawn from their neuroscience collaboration involving two antibody drugs. Meanwhile, Spire Healthcare disclosed that Toscafund has been granted an extension for a formal takeover bid, with a new deadline of August 6.
Outside the FTSE 100, Capita issued a profit warning, stating that its annual adjusted operating profit would be hit by £25 million to £40 million due to issues with its civil service pension contract. CEO Adolfo Hernandez acknowledged that the company's service "has not been good enough."
The broader market backdrop remains cautious following Wednesday's selloff, which saw the FTSE 100 slide 1.7%, its biggest drop since May 15. That decline was triggered by U.S. President Donald Trump declaring an early Iran deal dead, sending oil prices higher and weighing on more than 80% of the index. Oil prices edged down slightly in early European trade, with Brent crude falling to $76.99 a barrel, after hitting its highest since June 22 in the previous session. Tim Waterer, chief market analyst at KCM Trade, noted that flows through the Strait of Hormuz remain "very much up in the air."
The geopolitical tensions are particularly significant for the UK market, as higher oil prices can stoke inflation and raise bond yields, squeezing demand for equities. The Strait of Hormuz is a critical chokepoint for global oil and LNG shipments, with about a fifth of the world's supply passing through it before the Iran conflict.
Domestic data provided little direction. A survey from the Royal Institution of Chartered Surveyors showed that the UK housing market's downturn softened slightly last month, but Tarrant Parsons, RICS head of market analytics, said conditions would likely remain "relatively subdued" without more clarity on politics and interest rates.
Gainers helped prevent a broader market rout. According to AJ Bell data, top FTSE 100 risers included Computacenter, Antofagasta, Glencore, and Anglo American. On the downside, AstraZeneca, British American Tobacco, BAE Systems, and BP were the leading losers shortly after the open.
Investors face the risk that Thursday's split market could unravel into another widespread decline if oil prices rise again or Gulf shipping faces disruption. Chris Weston, head of research at Pepperstone, noted that the market still expects de-escalation at some point, but described the situation as "highly fluid" and said timing is difficult to predict.
