London open: Stocks slide as Moderna boss casts doubt over vaccines

At 0840 GMT, the FTSE 100 was down 1% at 7,036.98.

Sentiment took a hit after Moderna chief executive Stephane Bancel told the Financial Times that existing vaccines will struggle with the omicron variant and warned that it could take months for pharmaceutical companies to make enough jabs at a sufficient scale to make a difference.

CMC Markets analyst Michael Hewson said: "His tone contrasts with the likes of Pfizer and BioNTech who suggested any new vaccine would be able to modified fairly quickly. His rather candid comments have also seen oil prices slide back sharply, as an increasingly jittery market react with concern to the prospects of further restrictions and lower demand.

"As we look ahead to the rest of the week, this morning’s drop in markets shows that sentiment is set to remain extremely fickle until we get a clearer idea of what comes next when it comes to the new variant.

"As a result of these latest virus developments, markets are also dialling back expectations of when central banks might look to accelerate any normalisation measures. Expectations had been rising in recent days that the Federal Reserve might accelerate the pace of its tapering program when it meets in mid-December. This now appears to be up for grabs with markets looking to today’s testimony by Fed chair Jay Powell to US lawmakers to gather clues as to the central banks thinking on the likelihood of this happening."

In equity markets, oil giants BP and Shell both gushed lower as oil prices fell.

Property group Shaftesbury retreated despite restoring its progressive dividend policy and reporting improving trends and a narrower annual loss, while Countryside Properties slumped after it revised down its targets for FY22.

On the upside, budget airline easyJet flew higher after it reported a better-than-expected annual loss and said it expected capacity to return to pre-pandemic levels by the end of the current fiscal year.

The company posted a headline pre-tax loss of £1.13bn, compared with an £835m loss a year earlier and guidance of £1.14bn - 1.18bn. It also noted an increase in transfers and softer trading in the current quarter due to the outbreak of the new Omicron Covid variant.

Media group Future surged after saying it now anticipates adjusted results for FY22 to be "materially above" current expectations.

Market Movers

FTSE 100 (UKX) 7,036.98 -1.03%
FTSE 250 (MCX) 22,592.36 -0.72%
techMARK (TASX) 4,349.96 -0.82%

FTSE 100 - Risers

Ocado Group (OCDO) 1,848.00p 0.76%
Evraz (EVR) 574.00p 0.35%
B&M European Value Retail S.A. (DI) (BME) 626.60p 0.26%
Rightmove (RMV) 741.80p 0.24%
International Consolidated Airlines Group SA (CDI) (IAG) 131.26p 0.20%
Auto Trader Group (AUTO) 733.80p 0.19%
Aviva (AV.) 378.70p 0.13%
Anglo American (AAL) 2,687.00p 0.13%
Fresnillo (FRES) 915.40p 0.11%
Sage Group (SGE) 777.80p 0.10%

FTSE 100 - Fallers

InterContinental Hotels Group (IHG) 4,486.00p -2.48%
Ashtead Group (AHT) 5,984.00p -2.38%
Prudential (PRU) 1,265.00p -2.28%
DCC (CDI) (DCC) 5,506.00p -2.27%
BT Group (BT.A) 159.75p -2.23%
Entain (ENT) 1,707.00p -2.23%
ITV (ITV) 108.80p -2.16%
Lloyds Banking Group (LLOY) 45.79p -2.15%
Sainsbury (J) (SBRY) 283.60p -2.11%
Schroders (SDR) 3,445.00p -2.05%

FTSE 250 - Risers

Future (FUTR) 3,652.00p 14.41%
Micro Focus International (MCRO) 381.80p 1.43%
Greencore Group (CDI) (GNC) 124.80p 1.38%
Templeton Emerging Markets Inv Trust (TEM) 178.20p 1.14%
easyJet (EZJ) 508.20p 1.11%
Centamin (DI) (CEY) 95.50p 1.06%
Safestore Holdings (SAFE) 1,354.00p 1.04%
Trustpilot Group (TRST) 290.80p 1.04%
Pantheon International (PIN) 325.00p 0.93%
Wood Group (John) (WG.) 202.50p 0.75%

FTSE 250 - Fallers

Countryside Properties (CSP) 404.00p -8.14%
AO World (AO.) 100.10p -4.58%
Helios Towers (HTWS) 160.40p -4.52%
Diversified Energy Company (DEC) 98.00p -3.73%
Harbour Energy (HBR) 393.40p -3.29%
WH Smith (SMWH) 1,343.50p -2.89%
C&C Group (CDI) (CCR) 222.80p -2.88%
Man Group (EMG) 221.20p -2.77%
Mitie Group (MTO) 64.10p -2.58%
Drax Group (DRX) 551.50p -2.56%