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By Sudip Kar-Gupta
LONDON (Reuters) - Britain's top equity index steadied on Thursday after a sharp sell-off in the previous session that had taken it to a 15-month low, although healthcare group Shire (L:SHP) slumped for the second day in a row.
The blue-chip FTSE 100 index (FTSE) was up by 0.2 percent, or 14.21 points, at 6,225.85 points in early session trading on Thursday, recovering slightly after a 2.8 percent drop on Wednesday that sent it to its lowest level since July 2013.
Shire slid 9 percent to 3,647 pence, adding to a 22 percent drop on Wednesday, after U.S. pharmaceutical company AbbVie (N:ABBV) recommended that shareholders vote against its $55 billion takeover of Shire in the wake of a U.S. government move to curb deals designed to cut high taxes.
"The AbbVie deal does look dead in the immediate future. But Shire is still a quality business, and once the dust settles on this, I'd be looking to buy back into Shire shares at around 35 pounds," said Central Markets trading analyst Joe Neighbour.
The FTSE 100 hit a peak of 6,904.86 points at the start of September, which marked its highest level since early 2000.
However, the index has since lost ground and is down 8 percent since the start of 2014, as concerns have increased about the fragile state of the European economy given weak data coming out of Germany in the last two weeks.
Darren Easton, director of trading at Logic Investments, said he was "short" the FTSE - betting on future falls - for the near-term.
"We're still bearish in the short term," he said.
Easton said the FTSE could drop down to the 6,050 level during October, but he expected the FTSE to then rally in December and get back up to the 6,600-6,800 point range.
(Editing by Catherine Evans)