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(Alliance News) - Stock prices in London are seen opening lower on Monday as Europe's slow vaccine rollout continues to trouble markets amid a surge in Covid-19 cases on the continent.
In UK early company, Kingfisher resumed dividends as the DIY retailer benefited from a continued appetite for home improvements during lockdown. Drugmaker AstraZeneca announced positive trial results for its Covid-19 vaccine. Food delivery platform Deliveroo said it expects a market value between GBP7.6 billion and GBP8.8 billion from its imminent initial public offering.
IG futures indicate the FTSE 100 index is to open 12.21 points lower at 6,696.50. The blue-chip index closed down 70.97 points, or 1.1%, at 6,708.71 Friday.
Kingfisher said it was making good progress in its 'Powered by Kingfisher' strategic plan, unveiled in June.
For the financial year that ended January 31, revenue was up 7.2% at GBP12.34 billion from GBP11.51 billion a year before, while pretax profit multiplied to GBP756 million from GBP103 million.
Kingfisher declared a total dividend of 8.25 pence, having skipped payouts in financial 2020 due to the Covid-19 pandemic.
Looking ahead, Kingfisher said the new financial year has started positively, with first quarter like-for-like sales to March 18 up 24%, reflecting strong demand in the UK and France.
"Given the profile of trading during FY20/21, we expect distinct performances in the two halves of the coming year. In H1 21/22 we expect low double-digit group LFL sales growth, supported by the delivery of our strategic objectives," the company noted.
"Like many businesses, we continue to face challenges associated with the Covid crisis. However, since reopening our stores from mid-late April 2020, our sales performance has been strong, supported by the significant progress our business has made under our 'Powered by Kingfisher' strategy and favourable demand trends for home improvement. While uncertainty remains in the markets in which we operate, we are confident that we can address the key risks we face and that, as our strategy is delivered, we will continue to grow our business," Kingfisher said.
Deliveroo said the price for its initial public offering has been set in a range of between GBP3.90 and GBP4.60, implying an estimated market capitalisation on admission between GBP7.6 billion and GBP8.8 billion. The IPO will consist of up to 384.6 million shares, suggesting a value of at least GBP1.5 billion. Both new and existing shares will be offered, with the new shares expected to raise about GBP1 billion gross for the company.
Deliveroo said it will apply for admission of shares on the standard listing segment of the Official List of the Financial Conduct Authority and to trading on the main market of the London Stock Exchange.
The company said it intends to use the net proceeds from the issue of the new shares to continue to invest in the growth opportunities available.
Chief Executive Will Shu said: "We are proud to be listing in London, the city where Deliveroo started. Becoming a public company will enable us to continue to invest in innovation, developing new tech tools to support restaurants and grocers, providing riders with more work and extending choice for consumers, bringing them the food they love from more restaurants than ever before.
"This will help us in our mission to become the definitive food company. We have seen a strong start to 2021 and we are only at the start of an exciting journey in a large, fast-growing online food delivery market, with a huge opportunity ahead."
Deliveroo said the gross transaction value on its platform was up 121% in January and February on a year before.
In Asia, the Japanese Nikkei 225 index closed down 2.1% on Monday. In China, the Shanghai Composite ended up 1.1%, while the Hang Seng index in Hong Kong is 0.1% lower.
Calls for a lower open come as investors grow more concerned about Europe, where the vaccination programme has stuttered and a hike in new cases has forced countries including France and Germany to reimpose lockdowns.
A memo from a group of Germany's regions, seen by AFP, said the country's partial lockdown should be extended into April because of rising infection rates driven by Covid-19 variants.
In the southern French city of Marseille, around 6,500 people took part in a carnival parade, flouting the new restrictions that came into force this weekend.
The EU's internal market commissioner, Thierry Breton, said that Europe could reach herd immunity by July 14, pointing to the expected ramping up of vaccine deliveries.
But a new survey by YouGov on Monday showed that a majority of people in the biggest EU member states - including Germany, France, Spain and Italy - now view AstraZeneca's vaccine as unsafe.
The UK on Sunday warned the EU over its threat to halt exports of AstraZeneca's vaccines, in a row that has heightened post-Brexit tensions between London and Brussels.
AstraZeneca has delivered only 30% of the 90 million doses it promised the EU for the first quarter, infuriating European leaders and complicating the continent's already struggling vaccination drive. Brussels has accused London of operating its own de facto export ban to achieve its vaccine success, a claim denied by the UK government.
"Overall, the picture for [markets in] Asia is one of marking time while awaiting fresh inputs, likely to be delivered by the US and Europe. European and UK equities may have a more challenging time, with the UK-Europe vaccine spat, and Eurozone lockdowns weighing on markets," said Oanda Markets analyst Jeffery Halley.
AstraZeneca on Monday said its US Phase III trial of AZD1222 vaccine - co-invented by the University of Oxford - demonstrated statistically significant vaccine efficacy of 79% at preventing symptomatic Covid-19 and 100% efficacy at preventing severe disease and hospitalisation.
The Anglo-Swedish drugmaker said interim safety and efficacy analysis was based on 32,449 participants accruing 141 symptomatic cases of Covid-19. The trial had a 2:1 randomisation of vaccine to placebo.
Vaccine efficacy was consistent across ethnicity and age. Notably, in participants aged 65 years and over, vaccine efficacy was 80%, it added.
AstraZeneca said it will continue to analyse the data and prepare for the primary analysis to be submitted to the US Food & Drug Administration for Emergency Use Authorization in the coming weeks.
Mene Pangalos, executive vice President of BioPharmaceuticals R&D, said: "These results add to the growing body of evidence that shows this vaccine is well tolerated and highly effective against all severities of Covid-19 and across all age groups. We are confident this vaccine can play an important role in protecting millions of people worldwide against this lethal virus. We are preparing to submit these findings to the US Food & Drug Administration and for the rollout of millions of doses across America should the vaccine be granted US Emergency Use Authorization."
The pound was quoted at USD1.3855 early Monday, down from USD1.3874 at the London equity market close on Friday.
The euro was priced at USD1.1885, lower from USD1.1901. Against the yen, the dollar was trading at JPY108.70, down from JPY108.86.
Brent oil was quoted at USD64.17 a barrel Monday morning, up from USD64.07 at the London equities close on Friday. Gold was trading at USD1,730.84 an ounce, down from USD1,739.97.
Monday's economic calendar has eurozone current account data at 0900 GMT.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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