Tuesday Morning Markets: FTSE 100 Slides as GSK Shares Weigh Following Acquisition

London’s blue-chip index opened the week’s second session on the back foot, with the FTSE 100 falling 0.4% as a major pharmaceutical deal announcement sent GSK shares lower, bucking a broadly positive tone in European markets.

Continental peers have edged higher on Tuesday, with the DAX up 0.3% and the CAC 40 up 0.8%, helped in part by easing oil prices. 

With Iran-Israel tensions simmering but producing no fresh escalation overnight, some of the fear premium in crude has unwound, which is a modest tailwind for European growth stocks.

GSK Acquires Nuvalent for $10.6 Billion

The dominant headline so far today has come from GSK (LSE: GSK), which has entered into an agreement to acquire Nuvalent (NASDAQ: NUVL), a Boston-based clinical-stage oncology company, for a total equity value of $10.6 billion (approximately £8.0 billion).

Under the deal terms, GSK will pay $124 per share in cash, a 40% premium to Nuvalent’s last closing price and a 26% premium to its 30-day volume-weighted average price. 

Net of cash acquired, GSK’s total investment is estimated at $9.4 billion.

The strategic rationale centres on lung cancer. Nuvalent brings two late-stage, potentially best-in-class assets (zidesamtinib (a ROS1 inhibitor) and neladalkib (an ALK inhibitor)), both under active FDA review with target decision dates later in 2026. 

GSK CEO Luke Miels described the deal as “a multi-product transaction consistent with our approach to acquire assets that have clinically proven targets.”

Investors responded with caution as GSK shares fell around 3.2% to approximately 1,847.5p. 

The price tag has weighed on sentiment, even as management confirmed no change to 2026 full-year guidance and maintained the 70p expected dividend.

FTSE 100: Risers and Fallers

So far in the session, Bunzl is the biggest riser, up 2.8%, followed by Metlen Energy & Metals, up 2.5% and Persimmon, which has gained 2.2%.

On the downside, GSK is the standout faller, leading the index lower and accounting for a significant portion of the FTSE 100’s overall decline given its weighting. 

Meanwhile, Glencore has dropped 2.2%, while Sage Group is down 2%.

Looking Ahead

Attention now turns to US CPI data on Wednesday, which will be a key input for Federal Reserve expectations and could set the tone for risk assets heading into the end of the week.

On the technology calendar, Apple’s WWDC is underway, which could provide positive momentum for tech-adjacent names if AI announcements land well.