Hikma Pharmaceuticals, the generic drug producer, rose 23¾p to an 11-month high of 473½p amid persistent talk that larger players, such as GlaxoSmithKline and Pfizer, are running the rule over the company.

Pfizer’s head of emerging markets said a fortnight ago that it was looking for “regional opportunities” across the Middle East and North Africa to help it to double its $500 million (£300 million) sales in the region.

Analysts at Citigroup set a target of 500p on the Jordan-based Hikma, pointing out that its share price put it at a valuation around half the level that recent acquisitions in the region had achieved. However, members of the founding Dharwaza family control a third of the company and are not thought to be willing to sell at this stage and are seeking acquisitions.

The pharmaceuticals sector was one of the few bright spots in a relatively flat market yesterday, with the FTSE 100 closing 4.03 points down at 4,230.02. Shire was among the index’s top performers, rising 17½p to 828½p, as JPMorgan pointed to the attractions of its gene therapy products, due to start earning serious revenue after 2010. It also noted that sales of Replagal, Shire’s treatment for the inherited Fabry’s disease, should benefit from recent manufacturing problems experienced by Genzyme, which makes the rival treatment Fabrazyme. It reiterated “buy” advice, but cut its price target from £11.90 to £11.20 because of the weaker dollar.

International Power fell 5½p to 229¾p amid fears that it would follow the rival Drax, off 12½p at 436½p, with a share issue to satisfy rating agencies over its debt. National Grid, also highly indebted, fell 10p to 540½p — this despite JPMorgan upgrading the European utility sector, saying that electricity prices should rise in about seven months’ time.

Legal & General fell 4.77p to 55.83p as SG Securities cut it from “hold” to “sell”, saying that the company was the most exposed of the UK insurers to falling equity markets and rising corporate bond defaults. Most financial stocks were on the slide amid new worries about the global economy. Lloyds Banking Group fell 2.85p to 65p and Standard Chartered slid 40p to £11.35.

Thomas Cook fell 7p to 200p amid talk that administrators of Arcandor were close to selling its 52 per cent stake in the tour operator. The rival TUI Travel was buoyed by positive presentations in the City, in which it said it should benefit from Rewe, of Germany, buying Thomas Cook’s German assets. It rose 8¾p to 233½p.

Anglo American’s rejection of strata’s bid approach sent Anglo down 46p to £16.52, despite talk that Chinalco could move in, although traders believe that Xstrata, up 4.8p at 639.9p, is now itself in play and could attract the attentions of predators such as Chinalco and Vale, of Brazil. The best-performing miner was Antofagasta, up 21½p to 576½p, as the copper price rallied and there were suggestions that it, too, could become a target.

JD Wetherspoon rose 22p to 391½p after Morgan Stanley said that the pub group would take market share from rivals and upgraded it from “sell” to “buy”, with a 480p target.

• New York: US stocks slid slightly after data showed that sales of previously owned homes had risen at a slower pace than expected in May. The Dow Jones industrial average was down 16.10 at 8,322.91 at the close.

Smaller companies: Goldshield rises amid bid talk

Shares in Goldshield, the distributor of drugs to pharmacies that recently won a long legal battle with the Serious Fraud Office (SFO), rose 3¾p to 323½p before results tomorrow.

There are rumours that Ajit Patel, the former chief executive who quit two years ago while the SFO battle was going on, is eyeing a bid at 375p a share. However, he sold a third of his stake last month and others question whether he can raise the cash.

Shares in Reneuron leapt 1.125p, or a fifth, to 6.625p amid speculation that the company will be able to announce final ethical approval for trials of its revolutionary stem-cell treatment for stroke victims by the time of full-year results next Tuesday. Two weeks ago Reneuron signed a contract to finance production of stem cells from aborted foetuses by Angel Biotechnology, the contract producer, whose shares were up 0.01p at 0.405p last night.

Alexander Mining rose 1p to 5½p amid strong volume and talk of imminent contract wins for its AmmLeach leaching technology, which helps miners to extract metals from ore.

Gasol rose 0.3p to 2.025p after signing a joint-venture deal with Sonagas, the national gas company of Equatorial Guinea, to distribute in the country gas produced by Exxon Mobil from a Zafiro field offshore.

Imagination Technologies, a provider of video chips for mobiles, rose 4½p to 114½p after Intel, a customer, bought three million shares, lifting its stake from 14 per cent to 16 per cent. Intel, like Apple, which has 3.6 per cent, is thought to want to prevent a rival buying Imagination. Last week it picked up a tranche from Saad Investments. The latest buy may be from the administrator of Lehman Brothers, which has sold its 5 per cent stake below the 3 per cent declarable threshold.

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