Powerscourt

By Powerscourt on 18/09/2020

Powerscourt Coronavirus Briefing – 18 September 2020

ANALYSIS

The UK government’s plan to get Britain back to normal for the autumn is coming apart at the seams, largely because of the failure of the much-vaunted test and trace programme which ministers said would support a return to normality. Now, according to news reports, the dreaded second national lockdown – until recently dismissed as politically impossible – is moving onto the horizon.

Britain is, officially or unofficially, crashing into the long-dreaded second wave which scientists warned of earlier in the year. After nearly eight months of planning, gaming and scoping to provide a testing infrastructure to underpin confidence that work and school is safe, the country is not ready.

On Friday it was reported that senior UK government scientific advisers were recommending a shorter national lockdown, designed to act as a “circuit break” to curb a second period of renewed growth in infections. Matt Hancock, the Secretary of State for Health, refused to rule out another national lockdown, telling Sky News on Friday: “We will do what is necessary (to curb the resurgence of the virus).”

Approximately 15% of the UK population is already in regional lockdowns as the government’s strategy of local restrictions expands. Kamlesh Khunti, professor of primary care at Leicester University, told the Times that the local lockdown strategy would not work on its own without an effective testing regime.

Baroness Dido Harding of Winscombe, who heads up responsibility for the government’s test and trace programme, told parliament yesterday she and her officials were blindsided by the demand for tests.

“I don’t think anybody was expecting to see the really sizeable increase in demand that we’ve seen over the course of the last few weeks,” Lady Harding said. “In none of the modelling was that expected.”

She said she had planned on the basis of modelling by the government’s advisory group SAGE, and blamed people for using tests without symptoms. In blaming the public, she apparently failed to take into account that the government had previously pushed testing as a key way for people to reassure themselves that it is safe to go back to work.

In the US, it emerged that guidance on the website of the Centers for Disease Control, recommending that people without symptoms do not get tested, was written by government officials and had been strongly opposed by CDC scientists, causing another row between scientists and the Trump administration.

By contrast the pharmaceutical industry, perhaps desperate to ringfence its own credibility from being co-opted by political pressure, is offering surprising new levels of transparency to investors and the public about the clinical trials process behind the development of vaccines and therapeutics.

Moderna and Pfizer, which are driving two of the most promising vaccine candidates, both consciously lifted the kimono on Thursday as they revealed unprecedented amounts of detail on the design of their late stage trials – traditionally closely-guarded information which is not disclosed until after the trials are complete. Stephane Bancel, the CEO of Moderna, told investors at a Capital Markets event “transparency is important” for vaccine makers to win the confidence both of regulators and exhausted and sceptical citizens.

Data from the UK’s Office of National Statistics on Friday showed a rare bright spot: the UK’s economic recovery which began in the summer has been stronger than expected, based on retail sales. Whether this recovery survives a fresh round of restrictions, however, remains to be seen.

Asian shares rose into Friday after most global stock indices closed down on Thursday.

 

WHAT ARE COMPANIES SAYING?

 

Healthcare

Pfizer
Internal documents reviewed by Reuters have revealed that the pharmaceuticals giant expects its coronavirus vaccine to be showing clear evidence of effectiveness early in its clinical trial. Pfizer’s clinical trial protocol calls for a first assessment of the vaccine’s performance by the monitoring board after 32 participants in the trial become infected with the novel coronavirus. So far, more than 29,000 people have enrolled in the trial that started in July, some receiving the vaccine and the others receiving a placebo. Pfizer’s vaccine would need to be at least 76.9% effective to show it works based on 32 infections, according to its protocol. That would mean that no more than six of those coronavirus cases would have occurred among people who received the vaccine, the documents showed.

 

Industrials 

P&O Cruises
The cruise company owned by carnival has announced that it is cancelling all sailings until early 2021 as a result of the continuing impacts of the coronavirus pandemic. The company, owned by Carnival, said that it was monitoring the situation closely and working with scientists and government to ensure that they were ready when cruises did reopen. President of P&O Paul Ludlow said “We cannot wait for restrictions to ease, borders to open and for us to once again be able to set sail for a new beginning”. Customers who have bookings on cancelled cruises will be notified, and will receive a full refund or a credit worth 125% of their booking for a future cruise,

Essentra
The components and solutions business announced today that it had successfully completed its equity placing, raising gross proceeds of approximately £100 million. The funds will in part be used to fund an acquisition announced yesterday of 3C! Packaging for $65 million, with the remainder used to strengthen the company’s balance sheet and to give the company flexibility to pursue other compelling strategic opportunities as and when they arise.

Ryanair
The budget airline faced challenges from shareholders at its AGM yesterday over executive pay. 34.2% of shareholders voted against the executive pay, which saw CEO Micheal O’Leary paid a total of €3.47m. Of this €500,000 was base pay down from €1m a year ago, and which will be halved next year in response to coronavirus. It also included €2.5m of shares-based payments.  His €458,000 bonus was below the maximum €500,000 he could have received. This result was an improvement on last year however when only 51% of shareholders approved his remuneration package. 
 

 

Financials & Real Estate 

Investec
The financial services provider said in its pre-close trading update that it is faced by a “challenging economic backdrop” as a result of the pandemic and said that it would be cutting 210 jobs in the City of London in an effort to simplify and focus its business. The UK and South African broker and fund manager saw assets under management rise by 14% to £51.4 billion in the five months to August. Loans declined by 1.3% to £24.6 billion. CEO Fani Titi said “The business has proved resilient in a period characterised by COVID-19 stringent lockdowns in the first quarter, followed by a gradual reopening of the economies. Severe GDP contractions and volatile financial markets negatively impacted revenues. Capital and liquidity ratios remain robust and are expected to be stable.”

 

 

IN THE NEWS

Second national lockdown proposed by UK scientific advisers – Financial Times

UK DIY sales soar but clothing stores fall behind – BBC News

Almost half of firms set to swing jobs axe – Telegraph




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