UPDATE 1-European shares rise as healthcare shines bright; focus on US shutdown

(For a Reuters live blog on U.S., UK and European stock markets, click or type LIVE/ in a news window) * Healthcare sector eyes best day in over two years * UK's Tate & Lyle slides after cutting profit outlook (Updates prices, adds analyst comments and details) By Amir Orusov and Shashwat Chauhan Oct 1 (Reuters) – European shares advanced on Wednesday, with healthcare stocks leading the way following a U.S.-Pfizer deal that reduced uncertainty in the sector, even as concerns lingered over a potential delay in the release of the U.S. monthly jobs data. The pan-European STOXX 600 gained 0.3% to 560 points by 0903 GMT, set for its fourth consecutive day of gains. Local bourses were mixed. Spain's benchmark was down 0.4%, while the UK's FTSE 100 climbed 0.7% to an all-time high. Healthcare stocks jumped 3.1%, set for its biggest one-day gain since August 2023. On Tuesday, Pfizer agreed to lower prescription drug prices in the U.S. Medicaid programme in exchange for tariff relief. "The sector generally has struggled over the last year or so and what we are hopefully beginning to see is some measure of clarity about what the rules of the game may look like," said Richard Flax, chief investment officer at Moneyfarm. Other pharma stocks also gained. Ambu rose 7.2%, Sartorius 8.4%, Merck 5.7%, Roche 5% and AstraZeneca 6.2%. Separately, Novartis gained 2.5% after the U.S. Food and Drug Administration approved its oral treatment for a type of chronic inflammatory skin disease. On the downside, technology dipped 0.6%, while real estate lost 0.8%. Meanwhile, the U.S. government shut down much of its operations on Wednesday, something which could likely halt the release of the September employment report due on Friday. Without the data, it could impair the Federal Reserve's ability to gauge the economy's health before its monetary policy meeting later in the month. That means a U.S. private payrolls report due later in the day could receive more attention. In Europe, data showed euro zone manufacturing activity slipped back into contraction in September. A similar decline was reported from France and Germany. In the UK, manufacturing activity shrank at the fastest pace in five months. UK blue-chips remained higher on the healthcare boost, while the midcap index was last down 0.1%. Separately, euro zone inflation accelerated last month on higher services prices and a smaller decline in energy costs, likely reinforcing bets on the ECB keeping interest rates on hold for some time. Among other stocks, UK's Tate & Lyle dropped 9.4% after the food ingredients maker warned that its annual profit and revenue would fall. Arcadis climbed 8.6% after the Dutch engineering firm launched a new buyback program. (Reporting by Shashwat Chauhan in Bengaluru and Amir Orusov in Gdansk; Editing by Harikrishnan Nair)

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