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FTSE rises as AstraZeneca resumes COVID-19 vaccine trials

AstraZeneca

FTSE 100 rose 0.3% as the drugmaker resumed British clinical trials of its COVID-19 vaccine, after getting clearance from safety watchdogs

London’s FTSE share index rose on Monday as optimism from AstraZeneca’s resumption of trials of its COVID-19 vaccine coursed through stock markets, countering growing fears of a “hard” Brexit that will hammer a UK economy already struggling with fallout from the pandemic.

The House of Commons on Monday will debate the Internal Market Bill, which the EU has demanded Prime Minister Boris Johnson scrap by the end of September. After the debate, lawmakers will decide if it should go to the next stage.

The blue-chip FTSE 100 gained 0.3%, with AstraZeneca Plc among the top boosts to the index. The drugmaker said over the weekend it had resumed British clinical trials of its COVID-19 vaccine, one of the most advanced in development, after getting the green light from safety watchdogs.

UK equities are geared to react more quickly to good news, so with the vaccine developments coming back on track and global markets regaining some uptrend, we are looking at optimism returning to the market, said Chris Bailey, strategist at Raymond James. The mid-cap FTSE 250 added 0.2%, with aero, construction and media stocks leading gains.

A raft of stimulus has helped the FTSE 100 bounce from its coronavirus lows earlier this year, but analysts warned of caution with surging COVID-19 cases threatening a nascent economic recovery and no-deal Brexit fears returning to the forefront. All eyes this week will be on a Bank of England policy meeting on Thursday, where it is likely to signal more stimulus to lift the economy out of a deep recession.

In company news, U.S.-based Nvidia Corp is buying UK-based chip designer Arm from Japan’s SoftBank Group Corp for as much as $40 billion in a deal set to reshape the global semiconductor landscape.

British recruiting firm SThree Plc rose 2.6% as it said its underlying sequential performance had been improving since the first half of the year.

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