(Reuters) - British stocks rose on Wednesday as signs of progress in developing a COVID-19 vaccine bolstered hopes of a swift post-pandemic economic rebound, while major healthcare stocks propped up the blue-chip index.
The FTSE 100 ended up 1.8%, while midcaps added 1.4% after Moderna Inc’s experimental vaccine for COVID-19 showed it was safe and provoked immune responses in an early-stage study.
Reports of potential positive news on initial trials of the University of Oxford’s COVID-19 vaccine, which has been licensed to AstraZeneca, also propped up markets. AstraZenca was the biggest boost to the blue-chip index.
GlaxoSmithKline added 2.9% after an independent panel to the U.S. Food and Drug Administration voted in favour of approving the drugmaker’s experimental treatment for a common form of blood cancer.
“News on the COVID-19 vaccine development has provided a required shot in the arm to markets (and) we also see sentiment improving on (a pickup in) consumer spending across the United States and Europe,” said Patrik Lang, head of equity and global strategy at Julius Baer.
UK stock markets have struggled this month to build on a sharp rebound since a coronavirus-driven slump in March, as a surge in global infections and building U.S.-China tensions dented demand for riskier assets.
The focus now turns to the second-quarter earnings season, as investors look to corporate guidance on how a post-coronavirus recovery may play out.
Hong Kong-focused lenders HSBC Holdings Plc and Standard Chartered lagged broader gains after U.S. President Donald Trump ordered an end to the former British colony’s special status under U.S. law, prompting a warning from China. [MKTS/GLOB]
In a mixed bag of quarterly earnings updates, online fashion retailer ASOS jumped 3.4% on posting a sales bump through the coronavirus lockdown, while Burberry slumped 5.6% as it said demand had been severely impacted by the pandemic.
Reporting by Shashank Nayar in Bengaluru; Additional reporting by Sagarika Jaisinghani; Editing by Shailesh Kuber and Catherine Evans