Sanofi and GSK start Covid-19 vaccine trial, Melrose planning job cuts at GKN

London open

The FTSE 100 is expected to open 25 points higher on Thursday, having closed up 1.35% at 5,940.95 on Wednesday.

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Sanofi and GlaxoSmithKline said they had started a Phase 1/2 clinical trial for Covid-19 vaccine involving 440 people in the US. The companies on Thursday said they anticipated first results in early December to support the initiation of a Phase 3 trial in the same month. If data are sufficient for a license application, the duo said they planned to request regulatory approval in the first half of 2021. The vaccine candidate, developed in partnership by Sanofi and GSK, uses the same technology as one of Sanofi's seasonal influenza vaccines with GSK's established pandemic adjuvant technology.

Melrose Industries said it planned big job cuts at its GKN Aerospace business as the industrial turnaround company reported a first-half loss of £560m. The FTSE 100 company's pretax loss for the six months to the end of June widened from £131m a year earlier as revenue dropped to £4.1bn from £5.6bn. Adjusted operating profit dropped to £56m from £541m. Melrose said GKN's sales were expected to fall by up to 30% in 2020 and that it would make a "significant reduction" to the division's global workforce in the second half.

Tritax Big Box has sold its Chesterfield asset, it announced on Thursday, for £57.3m. The FTSE 250 company said that, as part of its ongoing portfolio evaluation, it decided to realise the value it had created on the asset with a sale to Warehouse REIT. It said the price was a premium to the 30 June book value, and reflected an internal rate of return of 18.5% per annum.

Newspaper round-up

The Bank of England has cast doubt on the government drive to get workers back to offices, after a senior official warned it was impossible for large numbers of staff to return to central London and other big cities while risks from Covid-19 remained. Pouring cold water on the government campaign, Alex Brazier, the Bank’s executive director for financial stability strategy and risk, said it was “not possible” for a mass return to city centre offices across Britain this autumn due to Covid guidelines, concerns over the health risks, and transport capacity issues. – Guardian

The number of empty shops on UK high streets has risen to its highest level in six years as city centres, and especially London, suffer from a dive in visitor numbers. Nearly 11% of shops remained vacant in July compared with 9.8% in January, with the number of empty premises rising in six out of 10 UK regions, according to retail analysis firm Springboard. Greater London suffered by far the worst blow, with empty shops increasing by nearly two-thirds. – Guardian

Two of the biggest names in British motorsport are embroiled in a bitter legal row over the building of the world’s first all-electric hypercar. Williams Advanced Engineering (WAE), spun out of the Formula One team that boasted Nigel Mansell, Damon Hill and Ayrton Senna as drivers, is preparing to sue Lotus over a contract to build the £2m Evija - billed as an engineering masterpiece with a top speed of more than 200mph. – Telegraph

The biggest investor in Tesla after Elon Musk has banked billions of dollars in profits for its clients by selling part of its stake in the maker of electric cars. Baillie Gifford said yesterday that it had cut its stake in Tesla to 4.25 per cent to prevent its clients being over-exposed to the company, which has enjoyed a spectacular re-rating in recent months, sending its shares up fivefold since January. - The Times

US close

Wall Street stocks closed higher on Wednesday, despite the release of some much weaker-than-expected payroll data.

At the close, the Dow Jones Industrial Average was up 1.59% at 29,100.50, the S&P 500 added 1.54% to 3,580.84, and the Nasdaq Composite was ahead 0.98% at 12,056.44.

The Dow Jones closed 454.84 points higher, carrying on gains recorded in the previous session.

Sentiment got a boost after Swiss pharma giant Roche revealed that it would be rolling out a new rapid antigen test throughout Europe before the end of the month, with the company also planning to apply for an emergency use authorisation from the US Food and Drug Administration (FDA).

However, news that Donald Trump and FDA head Stephen Hahn's much-touted plasma treatment did not appear to be effective against the coronavirus caused some to taper their expectations.