Pharmaceutical stocks a buy in the medium term

As pharmaceuticals have fallen out of favour their share prices are being driven by factors other than a wall of money. Pharmaceuticals form the third largest sector in the UK, at 10.5% of the FTSE All-Share, and it is heavily dominated by three companies - Glaxo Wellcome, SmithKline Beecham and AstraZeneca. Relative to the FTSE All-Share the sector is down some -8% over the past three months. John Wilson, investment director for Standard Life, says: "We were heavy in pharmaceuticals throughout 1998. We took some money out in January and are now underweight." As bond yields rise he is mo...