FTSE dips by 0.6% or 40 points to 6,563 after approval for Oxford’s Covid vaccine and vote passing post-Brexit deal were overshadowed by three quarters of UK being plunged into Tier 4 lockdown
- FTSE 100 index of biggest UK firms down by 0.60% or 40 points at 6,563 today
- Fall comes despite PM’s post-Brexit EU trade deal clearing House of Commons
- Covid-19 vaccine from Oxford University and AstraZeneca has been approved
- But millions more people were plunged into toughest Tier Four lockdown rules
The London stock market slipped this afternoon as news of the Covid-19 vaccine from Oxford University and AstraZeneca gaining approval was overshadowed by millions more people being plunged into the toughest Tier Four lockdown rules.
The FTSE 100 was down by 0.6 per cent or 40 points at 6,563 this afternoon despite Boris Johnson’s post-Brexit EU trade deal clearing the House of Commons at about 3pm, as the Government seeks to rush approval through Parliament in a single day.
London stocks initially rose following news of the jab, which has been described as a ‘game changer’, being given the green light by the UK medicines regulator.
But the FTSE fell in the afternoon, with the Paris and Frankfurt markets also dipping as Germany mulled extending its lockdown in the face of rising cases and deaths.
It comes one day after the FTSE closed up by 1.55 per cent or 101 points at 6,603 yesterday in what was a nine-month high for the index of Britain’s biggest firms.
The EU reaching an agreement in principle with China on an investment pact has failed to boost sentiment – but the Dow Jones in the US opened up 0.3 per cent.
PAST WEEK: The FTSE 100 index in London soared yesterday before tailing off this afternoon
PAST MONTH: The FTSE 100 has had a topsy-turvy month before its huge gains yesterday
Asia was mostly firmer with vaccine and economic recovery optimism helping investors look past the alarming surge in Covid-19 cases around the world.
The vaccine announcement at 7am in Britain this morning sent AstraZeneca shares racing 1.8 per cent higher, but it had given up the gains by the afternoon.
Moreover, the stock remains about 2.6 per cent down over the course of this year despite development of the group’s landmark vaccine.
Shares in drugs rival GlaxoSmithKline also rose and then gave up the gains. GSK shares have shed almost a quarter in value since the start of 2020.
‘The pharmaceuticals and biotech sector is down nearly 10 per cent for the year,’ AJ Bell investment director Russ Mould told AFP.
PAST YEAR: The FTSE 100 has endured a turbulent year after suffering huge falls in March
A woman walks near the Royal Exchange and Bank of England in the City of London on Monday
‘This seems like rank ingratitude given the importance of the vaccines upon which they are working, with the AstraZeneca-University of Oxford product due for roll-out any day now – and GlaxoSmithKline hopeful of launching a product in late 2021.
‘Yet through their very success, the drug firms are helping to promote the share prices of others – companies which will benefit much more dramatically from any success in the effort to contain and beat back the virus and permit any degree of return to economic normality.’
Health Secretary Matt Hancock said the vaccine is a ‘great British success story’ and that 530,000 of doses will be available for rollout from Monday.
But he announced in the Commons that far more parts of the country are now entering Tier 4 than before, with most other areas moving to Tier 3.
The Midlands, parts of the North East and North West and parts of the South West are among those areas escalated.
An additional 20million people will moved to the highest tier. This means a total of 44million people will now be in Tier 4, or 78 per cent of the population of England.
As for the EU trade deal, after little over four hours’ debate today, MPs voted by 521 to 73 to give the European Union (Future Relationship) Bill, ratifying the deal finally agreed on Christmas Eve, a third reading.
The Bill now goes to the House of Lords, where the debate is expected to continue until around 10.30pm tonight.
If, as expected, it passes the upper chamber, it will then go to the Queen for royal assent, with an announcement expected around midnight.
That would pave the way for the deal to take effect at 11pm tomorrow when the current Brexit transition period, during which the UK has continued to follow EU rules, ends.
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