London pre-open: Stocks seen lower as Covid vaccine hopes fade

London stocks were set to edge lower at the open on Wednesday amid doubts over a potential coronavirus vaccine from US biotechnology company Moderna.

The FTSE 100 was called to open 15 points lower at 5,987.

Overnight, shares of Moderna Therapeutics slumped after "several vaccine experts" cast doubt on the company's claim that its Covid-19 vaccine candidate had generated a significant immune response in a small sample of patients.

According to Stat, those experts said that Moderna had not revealed key information needed to interpret what results it did provide. The day before, Moderna had announced that all 45 patients in an early clinical trial for its vaccine had developed so-called "binding" antibodies against the virus.

Critically, eight of them had produced "neutralising" antibodies - the ones that confer the greatest protection.

Oanda analyst Jeffrey Halley said: “Regarding the overnight story, Stat News rightly points out that the sample size of eight trials was open to various bias, such as age and gender, and was rather small. Something I had mentioned yesterday. However, the article itself is perhaps a bit harsh on Moderna.

“The company has filed its data via official channels and to have exaggerated or misrepresented it would have been illegal for a multi-billion listed company, or any company for that matter. Nor was the trial for the effectiveness of the vaccine, instead it was to test dosages to produce anti-bodies and to monitor for side-effects. That reality, most likely limited the falls in equities on Wall Street overnight and Asia this morning.”

In corporate news, food and clothing retailer Marks & Spencer said full year profits fell by a fifth as it took a £218m hit from the Covid-19 impact and said no dividend would be paid in 2020/21.

The company reported pre-tax profits of £67.2m, down 20% including adjusting items of £335.9m, with £212.8m for costs and stock write downs for Covid-19. It

Food like-for-like revenue rose 1.9% and operating profit 11.2% as shoppers stockpiled in the early days of the UK lockdown, but clothing operating profit slumped by 37.0%, adversely impacted by availability in the first half.

Rolls-Royce said it would cut at least 9,000 jobs as part of a plan to save more than £1.3bn a year in response to the Covid-19 crisis.

The engine maker said the job cuts from its global workforce of 52,000 would mainly affect the civil aerospace business and that it would review the division's facilities. The restructuring will also cut spending on plant and property, capital and other areas. The cost of the programme will be about £800m over three years.