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(Alliance News) - Stock prices in London opened higher on Monday on hopes of a treatment for the coronavirus, while BT shares surged following a press report saying the telecommunications firm could be subject to a takeover.
US authorities announced on Sunday an emergency authorisation for doctors to use blood plasma from recovered coronavirus patients as a treatment against the disease that has killed over 176,000 in the US.
The move by the US Food & Drug Administration comes as President Donald Trump faces intense pressure to curb the contagion that has impaired the world's largest economy and dimmed his prospects for re-election in November. The plasma is believed to contain powerful antibodies that can help fight off the disease faster and help protect people from being seriously hurt by it.
In London, the blue-chip FTSE 100 index was up 72.97 points, or 1.2%, at 6,074.86. The mid-cap FTSE 250 index was up 87.79 points, or 0.5%, at 17,665.47, but the AIM All-Share index was up 0.3% at 959.93.
The Cboe UK 100 index was up 1.3% at 604.69. The Cboe 250 was up 0.4% at 15,000.68, and the Cboe Small Companies was flat at 9,571.65.
In mainland Europe, the CAC 40 index in Paris was up 1.6%, while the DAX 30 in Frankfurt was up 1.5%.
"Trading has kicked off the new week on the front foot thanks to vaccine optimism after the FDA approved the use of blood plasma from recovered patients as a Covid treatment option for coronavirus patients in hospital. Whilst this is by no means that big coronavirus cure that the world is waiting for it is most certainly another step in the right direction," said City Index analyst Fiona Cincotta.
"Adding to the upbeat mood, Trump is considering bypassing normal US regulation to fast track the British vaccine candidate by Oxford University and AstraZeneca for use in the US prior to the US Presidential elections," Cincotta added.
The Trump administration is considering options which include allowing the US Food & Drug Administration to award an emergency use authorisation in October to a vaccine being developed by AstraZeneca and Oxford university, should results from a study being carried out prove successful, the Financial Times reported on Sunday.
While the US government's scientific agencies have said that a vaccine would need to be studied in 30,000 people to pass the threshold for authorisation, the study being carried out by Astra only involves 10,000 people. The FT noted that the company is also conducting a larger study with 30,000 volunteers, but highlighted the results from that will come after the smaller trial.
AstraZeneca was up 2.0%.
Telecommunications firm BT was the best performer in the FTSE 100 index, up 7.0% following a weekend press report that BT has put investment banks on high alert to fend off potential takeover approaches.
Sky News reported that BT has contacted Goldman Sachs to update its bid defence strategy in recent weeks. So far, BT has not received any formal approaches, according to Sky.
BT's market value stands at GBP10.77 billion, with its share price having fallen to an 11-year low earlier this month.
Bunzl was up 3.1%. The distribution and logistics firm said it delivered a resilient performance in the first half despite the unprecedented challenges posed by the Covid-19 pandemic.
For the half-year to June 30, revenue rose 7.0% to GBP4.85 billion from GBP4.53 billion last year, and pretax profit was up 22% to GBP245.4 million from GBP200.5 million.
Bunzl raised its interim dividend 1.9% to 15.8 pence from 15.5p paid out last year. As a result of the better-than-expected trading performance during the first half of the year. Bunzl said it also has decided to reinstate and pay the final dividend for 2019 at the same level as originally proposed of 35.8p.
Bunzl said that, as it is no longer possible for this dividend to be approved by shareholders at the annual general meeting, it will be paid as an additional interim dividend in November.
At the other end of the large caps, British Airways parent International Consolidated Airlines was the worst performer, down 2.5%, amid continuing pressure on the travel sector.
More than 90,000 jobs have been lost or placed at risk across the wider UK travel sector since the coronavirus crisis started, the association of travel agents and tour operators has said.
Abta has written to UK Chancellor of the Exchequer Rishi Sunak asking for a package of measures to support businesses and employees before thousands more jobs are lost. It is calling on the government to adopt a "regionalised" approach to quarantine rules and use the Autumn budget to announce an air passenger duty holiday covering summer 2021 to incentivise people to book holidays.
The travel association warned that the job situation in the industry had reached a "critical point", with measures to control the pandemic affecting the market.
Pearson was down 0.5%. The education publisher appointed Non-Executive Director Andy Bird as its new chief executive to replace the outgoing John Fallon, who had announced his departure in December.
Bird will assume the role on October 19, and Fallon will continue as CEO until that date. Bird joined the education publisher in May. He spent 14 years at Walt Disney Co and was chair of Walt Disney International.
The Japanese Nikkei 225 index closed up 0.3%. In China, the Shanghai Composite closed up 0.1%, while the Hang Seng index in Hong Kong is up 1.3%.
The pound was quoted at USD1.3088 Monday morning, flat from USD1.3090 at the London equities close Friday.
The euro was priced at USD1.1794 early Monday, firm from USD1.1785 late Friday. Against the yen, the dollar was quoted at JPY105.90 in London, flat from JPY105.89.
Brent oil was trading at USD44.39 a barrel Monday morning, up from USD43.84 on Friday evening. Gold was quoted at USD1,932.46 an ounce, down from USD1,941.70.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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