FT : Scientists question lasting immunity from virus vaccine

Scientists question lasting immunity from virus vaccine
Study shows recovered patients’ antibodies declined within months of infection

Scientists are questioning whether waning immunity to Covid-19 could affect how useful a vaccine will be in tackling the pandemic, even as investors welcomed new positive early trial data. 

A study from King’s College London, which has yet to be peer-reviewed, showed recovered patients’ antibodies declined significantly within months of infection, raising the critical issue of how long a vaccine could prevent people catching the disease. 

The concerns come as shares in Moderna rose 6 per cent on Wednesday after the US biotech company shared positive data from its phase one trial showing all 45 participants had produced antibodies after taking its vaccine candidate. 

Herb Sewell, emeritus professor in immunology at the University of Nottingham and a consultant immunologist, said the King’s College study appeared to show that antibodies to the virus disappeared more quickly than other coronaviruses, such as the Middle East Respiratory Syndrome, which had an immune response that lasted at least a couple of years. 

“If the vaccine response drops off like the natural response does, it does mean we’d have to give repeat ones,” he said. 

It is normal to see some decline in antibody loads after a vaccine, which will still be effective if the body can subsequently produce antibodies more quickly when exposed to the virus again. Importantly, the body does not always respond in the same way to a vaccine, as it does to an infection.

Tal Zaks, chief medical officer at Moderna, said he believed it was “entirely plausible” that the antibodies fade, but that it might be because those patients were asymptomatic or started with lower levels of antibodies. 

“They seem to lose them more quickly, which probably speaks to the quality and type of immune response to begin with,” he said. “It's reassuring to see that we achieve neutralising antibodies that are consistently above what you see from people who've actually been sick, so we expect they are going to be protected.”

Betty Diamond, director at the Feinstein Institutes for Medical Research in New York, said the Moderna results were “encouraging” but more information was needed about how long the response will last. Participants’ antibody levels started to decline 41 days after the vaccine, but the trial data only went until 57 days. 

“Vaccines present antigen differently than natural infection and use different adjuvants [chemical boosters], therefore there is no reason to assume the immune memory will be the same with vaccines as with natural infection,” she said.

It will be important that a vaccine induces a high level of antibodies from the start. Umer Raffat, an analyst at Evercore ISI, said on a call with investors that the participants’ response to Moderna’s potential vaccine has been “materially higher” than other candidates including those from US-based Inovio and Chinese company Cansino Biologics. 

While it was hard to compare them directly, the Moderna vaccine also seemed to induce a better response than the vaccine being developed by Pfizer with Biotech, Mr Raffat said.

Both are using a novel technique called messengerRNA to transcribe the virus’ spike protein into a human cell to show it to the immune system.

Scientists and investors will be closely watching the longer phase three trials that Moderna and other vaccine makers are preparing to embark on this month, to see where the number of antibodies plateaux. 

They are also interested in seeing how participants’ antibodies react when they come into contact with Covid-19 beyond the laboratory. Penny Heaton, chief executive of the Bill and Melinda Gates Research Institute, wrote in the New England Journal of Medicine that the laboratory techniques for confirming that there were antibodies in a participant’s blood were “notoriously variable”. 

“Confirmation of the correlation between antibody titers [concentration] and protection against Covid-19 will be possible only in a large clinical efficacy study,” she wrote in an opinion article that accompanied the publication of the peer-reviewed data on Moderna’s vaccine candidate.

Given the concerns about possible declining levels of antibodies, experts are likely to examine more closely the response a vaccine induces from T-cells, another key part of the immune system. 

Mr Raffat said he had heard AstraZeneca would show a robust response from both T-cells and antibodies to the vaccine it is developing with the University of Oxford,. AstraZeneca did not respond to a request for comment.

On the call with investors on Wednesday, Mr Raffat concluded: “If I want to take a vaccine in January, I’ll probably want to take Astra for a T-cell response and Moderna or Pfizer BioNTech for a neutralising antibody response.”

FT : ECB’s Lagarde set to flag continued stimulus as crisis rages

ECB’s Lagarde set to flag continued stimulus as crisis rages
Central bank chief set to signal ECB is a long way from scaling back bond-buying

When she was growing up in Le Havre, Christine Lagarde joined France’s synchronised swimming team, which she later described as “a sport of resistance and endurance” that taught her how to “grit your teeth and smile”.

The European Central Bank president may need those skills when she unveils the central bank’s latest monetary policy decision on Thursday and tries to explain why, despite a nascent economic recovery, it is still too early to seek an exit from its emergency bond-buying programme.

Having ramped up its monetary stimulus dramatically in response to the disruption of the coronavirus pandemic, Ms Lagarde signalled in a video interview with the Financial Times last week that the ECB is now set to pause and take stock before any fresh action. 

“Through the impact of the massive programmes that we put in place, the situation has calmed down enormously,” the ECB president told the FT, adding: “We have done so much that we have quite a bit of time to assess [the economic data] carefully.”

At its last monetary policy meeting in early June, the ECB expanded the amount of bonds and other assets it plans to buy under its Pandemic Emergency Purchase Programme from €750bn to €1.35tn and extended its timespan until at least the end of 2022.

Since then, the outlook for the eurozone economy has become slightly less apocalyptic. Consumers went on a spending spree after shops reopened in May, helping retail sales across the region make up much of the ground lost with record falls in March and April, while industrial output also recovered, albeit at a slower rate.

This has prompted some senior policymakers — including ECB executive director Isabel Schnabel and Dutch central bank governor Klaas Knot — to say it may not need to spend the entire €1.35tn put aside for its emergency bond-buying programme after all.

Calls for the ECB to wind down its main crisis-fighting tool earlier than expected could intensify if EU leaders reach agreement on a proposed €750bn recovery fund to support countries hit hardest by the pandemic at a summit later this week.

Yet Ms Lagarde is likely to keep stressing that a deal on the EU recovery fund is far from certain this year and the economy is still a long way from making a full recovery.

The eurozone has so far avoided a big surge in bankruptcies or job losses. But that is only thanks to massive government support as well as monetary stimulus by the ECB. There are big questions about how long taxpayer support will last and what will happen after it ends.

“For now, the ECB can afford to wait and see,” said Florian Hense, economist at Berenberg. “Better that the ECB overdoes it a little now and pull back at a later date than do too little and run the risk that the recovery could fizzle out.”

Crucially, inflation remains much closer to zero than to the ECB’s core target of just under 2 per cent. So Ms Lagarde is likely to grit her teeth and smile as she explains why the ECB is still a long way from declaring the crisis over and scaling back its bond-buying.

FT : Chinese GDP grows 3.2% in second quarter

Chinese GDP grows 3.2% in second quarter
Economic recovery from coronavirus boosted by industrial production but consumption remains weak

China’s economy returned to growth in the second quarter, in one of the world’s earliest signs of recovery from the fallout of the coronavirus pandemic.

Gross domestic product grew 3.2 per cent in the three months to the end of June, compared with the same period last year, exceeding forecasts.

The figures follow the first annual decline in decades in the previous quarter, when China’s GDP fell by 6.8 per cent as the country struggled to deal with the impact of the Covid-19 crisis.

The return to growth coincided with a period when new reported cases of the virus had fallen sharply and greater state support for the industrial sector, even as consumption remained weak.

Liu Aihua, spokeswoman for the country’s National Statistics Bureau, said the figures “demonstrated a momentum of restorative growth and gradual recovery”. But she also pointed to “mounting external risks and challenges” as the virus continued to spread globally.

“We are confident on the economic recovery in the second half of this year,” she added.


Data from China, where coronavirus was first discovered, is being closely watched as economies around the world grapple with the effects of the crisis.

Despite local outbreaks of the virus, including last month in Beijing, new daily cases have typically remained in the tens per day in the second quarter as the pandemic has gathered pace in the US, Europe and Latin America.

In April, China eased lockdown measures in Wuhan, the original centre of the virus, but has continued to enforce strict rules on testing and closed off the country to most international flights.


Rising GDP in the second quarter was helped by strong industrial production, which increased 4.4 per cent compared with the same period a year earlier and rose in each of the past three months.

The Chinese state has supported industrial activity over recent months, in part through increasing the amount local governments can borrow for infrastructure projects. A rise in construction has helped boost the country’s steel output when production has shrunk in other big national producers.

“In China the story is very reliant on what is happening domestically,” said Louis Kuijs, head of Asia economics at Oxford Economics. “The momentum should be strong enough to make it quite unlikely [we] see another fall in GDP,” he added.

Retail sales fell by 3.9 per cent in the second quarter, signalling an uneven recovery and continued pressure on consumption. The unemployment rate in June was 5.7 per cent, a slight improvement on May’s figure of 5.9 per cent.

Marcella Chow, global market strategist at JPMorgan Asset Management, pointed to the high savings rates of domestic consumers over the course of the pandemic, but added that consumption could recover quickly if confidence returned.

China reported positive trade data this week, which showed exports unexpectedly rising by 0.5 per cent in June compared with last year. But Ms Chow said that external demand for Chinese exports could remain weak as a result of lockdown measures in Europe and the US.

Stocks in Asia-Pacific markets retreated after the data were released.

The CSI 300 index of Shanghai- and Shenzhen-listed stocks was down 1.6 per cent and Hong Kong's Hang Seng index fell by 1.2 per cent. In Japan, the Topix dipped 0.6 per cent and Australia's S&P/ASX 200 was down 0.9, while the Kospi in South Korea shed 0.6 per cent.

“Markets DON'T like the unenthusiastic Chinese spenders,” Trinh Nguyen, senior economist for emerging Asia at Natixis, wrote on Twitter.

>>> US After Hours Summary: TWTR -3.7% falls on account hacks; DEL

After Hours Summary: TWTR -3.7% falls on account hacks; DELL +7.4% up nicely as it confirms it's exploring a potential spin-off of VMW; AA +6.1% up on earnings

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: AA +6.1%, HIG +3.1%, OI +0.1%

Companies trading higher in after hours in reaction to news: DELL +7.4% (Dell confirms it's exploring a potential spin-off of VMW stake), RTIX +5.3% (receives all necessary approvals for sale of OEM business), SPCE +5% (names new CEO), AZN +3.8% (AZN partner Oxford's COVID-19 vaccine candidate generates immune response in Phase I human trials), GAN +3.2% (reports June 2020 Internet gambling update for NJ), DKNG +2.4% (launches Casino product suite in West Virginia), VMW +2.4% (Dell confirms it's exploring a potential spin-off of VMW stake), RDFN +2% (says home sales exceed pre-pandemic levels for the first time), CLGX +0.9% (discloses that the FTC is conducting an investigation of the proposed acquisition), GD +0.8% (awarded $250 mln Army contract), OI +0.1% (to divest its Australia and New Zealand business unit; also guides EPS lower)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: SNBR -2.6%

Companies trading lower in after hours in reaction to news: TCDA -36.6% (provides regulatory update for veverimer; FDA has identified deficiencies), APTO -8.1% (stock offering), INMB -6.1% (stock offering), BCEL -5% (stock offering), CYTK -4.9% (announces $150 mln common stock offering), TWTR -3.7% (falls on headlines of high profile Twitter account hacks), AAL -3.1% (warns 25K employees of potential job cuts; also says June passenger revs down more than 80% yr/yr), IAC -0.8% (releases letter to shareholders)

>>> US Gapping down

Gapping down
In reaction to disappointing earnings/guidance
:

  • ASML -1.6%, BK -0.4%

Other news:

  • ZYXI -11.9% (prices offering of 2,500,000 shares of its common stock at $22.00 per share)
  • ADPT -5.2% (commences public offering of 8 mln shares, 2 mln of which were from selling shareholder; also files for mixed securities shelf offering)
  • VHC -4.4% (confirms receipt of Patent Trial and Appeal Board decisions)
  • VXX -2.6% (trading lower with US futures up over 1%)

Analyst comments:

  • FTNT -2.2% (downgraded to Neutral from Buy at Goldman)
  • SLM -0.6% (downgraded to Neutral from Overweight at JP Morgan)
  • GWPH -0.5% (downgraded to Hold from Buy at Stifel)

>>> US Gapping up

Gapping up
In reaction to strong earnings/guidance
:

  • ORGO +34%, LCII +10.4% (guides Q2 sales well above expectations), GS +4.1%, USB +2.4%

Select ETFs showing strength:

  • XLE +2.5%, IWM +2.4%, XLF +2.2%, DIA +1.7%, SPY +1.2%, QQQ +0.5%

Other news:

  • VBIV +18.2% (extends momentum from Tuesday regular session)
  • MRNA +17.9% (confirms publication of interim results from Phase 1 study of COVID-19 vaccine candidate)
  • TXMD +9.4% (TherapeuticsMD and Nurx expand access to ANNOVERA)
  • PRQR +7.9% (enters into $30 mln convertible debt financing with Pontifax)
  • PVH +3.9% (to streamline N American operations, includes exit from Heritage Brands)
  • STNG +3.9% (reports specific insider buy transactions)
  • FANG +2.5% (reports 2Q20 production; revises FY20 production guidance lower)
  • ORTX +2.5% (entered into two worldwide royalty-bearing license agreements with GlaxoSmithKline (GSK))
  • NVCR +2.5% (entered into a clinical trial collaboration agreement with Merck to develop Tumor Treating Fields together with MSD's anti-PD-1 therapy KEYTRUDA for treatment of non-small cell lung cancer)
  • GSK +2.4% (FDA advisory committee votes in favor of positive benefit/risk profile)
  • SIRI +2.1% (approves $2 bln increase to stock repurchase program)
  • BDX +1.7% (announces the Government has committed to use of BD Veritor Plus system and 15-minute SARS-CoV-2 test kits)
  • FSM +1.6% (reports Q2 production)
  • AAPL +1.4% (The General Court of the EU annuls decision taken by the EU commission regarding the Irish tax rulings against Apple; also - target raised to $450 at Needham)
  • MDT +1% (acquires Medicrea)

Analyst comments:

  • GPS +6.3% (upgraded to Outperform from Sector Perform at RBC Capital Mkts)
  • HBI +5.3% (upgraded to Strong Buy from Mkt Perform at Raymond James; upgraded to Neutral from Underperform at BofA Securities), ALLY +4.6% (upgraded to Overweight from Neutral at JP Morgan)
  • HRB +4.4% (upgraded to Buy from Neutral at Northcoast)
  • PUMP +4.3% (upgraded to Outperform from Market Perform at Cowen)
  • HAL +3.4% (upgraded to Outperform from Market Perform at Cowen)
  • SLB +3% (upgraded to Outperform from Market Perform at Cowen)
  • MT +2.8% (initiated with a Buy at Goldman)
  • HOG +2.7% (upgraded to Buy from Neutral at UBS)
  • AR +2.6% (upgraded to Neutral from Sell at MKM Partners)
  • WFC +2.5% (upgraded to Outperform from In-line at Evercore ISI)
  • TDY +2.2% (upgraded to Buy from Hold at Jefferies)
  • NMIH +1.9% (upgraded to Overweight from Neutral at JP Morgan)

>>> US Early premarket gappers

Early premarket gappers

  • Gapping up:
    • VBIV +18.6%, MRNA +13.3%, PRQR +10.8%, LCII +10.4%, STNG +5.5%, SIRI +2.7%, PVH +2.5%, FANG +2.1%, GSK +2%, USB +1.7%, FSM +1.6%, AAPL +1.6%, IWM +1.6%, XLE +1.3%, XLF +1.2%, ADPT +1%, DIA +1%, PG +0.8%, SPY +0.8%, MDT +0.7%, BK +0.5%
  • Gapping down:
    • ZYXI -13.2%, VHC -8.8%, ASML -1.8%, VXX -1.7%, AMAT -0.7%, UNH -0.5%

>>> Europe : Brokers Upgrades & Downgrades - 15th of July 2020 V2(+)

>>> Up
* Altice USA Raised to Buy at HSBC; PT $28
* Essity Raised to Equal-Weight at Barclays; PT 299 kronor
* Gjensidige Raised to Hold at HSBC; PT 179 kroner
* JM Raised to Buy at Handelsbanken; PT 280 kronor
* Medacta Raised to Buy at Octavian; PT 92 Swiss francs (+)
* Varta PT Raised to 120 euros from 100 euros at Berenberg
* Weir Raised to Buy at SocGen; PT 1,400 pence (+)

>>> Down
* Akzo Nobel Cut to Reduce at Baader Helvea; PT 78 euros
* Avanza Cut to Hold at Handelsbanken; PT 178 kronor
* Axa Cut to Sell at Citi
* Bouygues Cut to Hold at Jefferies; PT 34 euros
* Clariant Cut to Neutral at Exane; PT 18 Swiss francs
* Deutsche Boerse Cut to Sell at M.M. Warburg; PT 145 euros (+)
* Ferrexpo Cut to Underweight at JPMorgan; PT 150 pence
* Kion Raised to Hold at LBBW; PT 61 euros
* Moncler Cut to Sector Perform at RBC; PT 35 euros
* Santander Consumer Cut to Underweight at JPMorgan; PT $14.50

>>> Initiation
* 3i Rated New Outperform at Exane; PT 970 pence
* Alpha Bank Reinstated Hold at HSBC; PT 70 euro cents
* Anglo American Reinstated Neutral at Goldman; PT 1,900 pence
* ArcelorMittal Reinstated Buy at Goldman; PT 14 euros
* EUROB GA Reinstated Buy at HSBC; PT 60 euro cents
* Glencore Reinstated Buy at Goldman; PT 220 pence
* Nanoform Finland Rated New Buy at Stifel; PT 4.75 euros (+)
* National Bank of Greece Reinstated Buy at HSBC; PT 1.80 euros
* Piraeus Bank Reinstated Hold at HSBC; PT 1.45 euros
* Zoo Digital Group Rated New Buy at Stifel; PT 112 pence (+)

>>> Call
* Akzo Nobel’s Cyclical Risks Not Reflected in Consensus: Baader
* ASML Results May Not be Good Enough, But Guidance Better: Kempen (+)
* Atlantia Close to Resolution With Italy, Should Re-Rate: RBC (+)
* Axa Gets a Rare Sell as Citi Cites Cashflow, Liquidity Issues
* Basler, Varta Added to Berenberg’s DACH/Nordic Top Picks for 2H
* BNP Top Pick in French Banks on Recovery Potential: Jefferies
* Dixons Consensus Estimates May Fall With Uncertain Outlook: MS (+)
* Goldman Initiates on Miners; Glencore and Mittal Both Buy Rated
* Handelsbanken Set to Trade in Line With Market Post 2Q: Goldman (+)
* Moncler Execution Risk High Amid Earnings Concentration: RBC
* Premier Oil’s Net Debt Expected to Drop in 2H, Jefferies Says (+)
* Tele2’s 2Q Beat Reads Well for Telia and Telenor, SHB Says (+)