What to watch: Vodafone shares jump on growth, Santander profits sink, GSK variant vaccine hopes

Tom Belger
·Finance and policy reporter
·4-min read
A woman wearing a face mask walks past a closed Vodafone store in Spain. Photo: Xisco Navarro/SOPA/Sipa USA
A woman wearing a face mask walks past a closed Vodafone store in Spain. Photo: Xisco Navarro/SOPA/Sipa USA

Here are some of the top business, market, and economic stories you should be watching today in the UK, Europe, and around the world.

Vodafone shares jump on return to growth

Shares in Vodafone (VOD.L) jumped more than 3% in London on Wednesday morning, as its return to growth in service revenue cheered investors.

The telecoms company recorded a 0.4% increase in its measure of “organic” service revenue growth in its third quarter, though organic and reported total revenues were both down.

Subdued global travel continues to hit the company’s sales, with visitor numbers and roaming use both down.

In the UK, its mobile contract customer numbers rose by 77,000, driven by strong iPhone demand and fewer people leaving. It added 38,000 fixed broadband customers, helped by Black Friday.

Santander boss predicts vaccine driven recovery as profit falls 35%

The executive chairman of Santander (SAN.MC) is optimistic about a vaccine driven recovery for the global economy.

Ana Botin said in the bank’s results statement on Wednesday that she had “realistic optimism” about the outlook for the world this year.

“Vaccination is the most important economic policy for 2021,” she said. “We will not let down our guard, but I define my view as one of realistic optimism. A successful roll out of the vaccine will act as a strong catalyst for economic recovery.”

Wednesday’s comments came as the Spanish banking giant reported fourth quarter and full-year results. Pre-tax profit at the bank fell 25% in the final quarter of 2020 and was down 35% to €9.6bn (£8.4bn) for the year as a whole.

Income was down 10% to €44.6bn in 2020 and provisions for future losses rose 31% to €12.1bn. Underlying pre-tax profit slumped 38% to €5bn.

GlaxoSmithKline partners with CureVac to develop vaccines for new COVID-19 variants

Pharma giant GlaxoSmithKline (GSK.L) and German biopharmaceutical firm CureVac (CVAC) announced a €150m (£132m, $181m) partnership to develop next generation mRNA vaccines for new strains of COVID-19 “to keep one step ahead of the pandemic.”

“GSK and CureVac will contribute resources and expertise to research, develop, and manufacture a number of novel mRNA vaccine candidates,” CureVac said.

“The increase in emerging variants with the potential to reduce the efficacy of first generation COVID-19 vaccines requires acceleration of efforts to develop vaccines against new variant,” it added.

Development will begin immediately, with the target of introducing the vaccine in 2022, subject to regulatory approval.

GSK will make an upfront payment of €75m and a further payment of €75m conditional on the achievement of specific milestones.

Chinese New Year and Valentine's Day drive pick up in diamond demand, say De Beers

Diamond miner De Beers said demand for rough diamonds in its first sales cycle of 2021 rose $99m ($72.5m) year-on-year, in part thanks to two upcoming occasions: Chinese New Year on 12 February and Valentine’s Day two days later.

Bruce Cleaver, De Beers Group CEO, said: "Following strong sales of diamond jewellery over the key holiday season in the US, we saw good demand for rough diamonds at the first cycle of the year.”

“Sales of rough diamonds are also being supported by expected demand ahead of Chinese New Year and Valentine's Day,” he added.

He said that while risks to recovery amid lockdowns and restrictions on the movement of both people and goods persist, “we have been encouraged by demand conditions."

Stocks rise on US stimulus progress, tech earnings and vaccine rollout

Global stocks rose on Wednesday, as US stimulus and vaccine developments lifted sentiment.

Stronger hopes of recovery in the world’s biggest economy boosted the mood on global markets, with many investors’ worries easing over the Reddit-fuelled short squeeze.

The White House confirmed plans to hike weekly vaccine supplies to 11.5 million doses, distributing doses directly to up to 40,000 pharmacies. New president Joe Biden had condemned the pace of the rollout under his predecessor.

Congress also moved a step closer to signing off Biden’s $1.9tn (£1.3bn) stimulus package in spite of Republican opposition on Tuesday.

Meanwhile record earnings from Amazon (AMZN) and surging advertising revenue at Google’s parent company Alphabet (GOOG, GOOGL) also boosted stock markets.

WATCH: What is a short squeeze? The GameStop stock trading frenzy explained

US futures were pointing to another day of gains. S&P 500 (ES=F) were up 0.6% and Dow Jones futures (YM=F) up 0.4% as European markets opened, while futures on the Nasdaq (NQ=F) rose 1%.

In Europe, Germany’s DAX (^GDAXI) rose 0.7%, France’s CAC 40 (^FCHI) was up 0.6% and the Europe-wide Stoxx 600 (^STOXX) rose 0.8%. The FTSE (^FTSE) was trading 0.6% higher in London.

Most Asian stock indices had also risen overnight. Japan’s Nikkei (^N225) was up 1% and the Kospi (^KS11) in South Korea rose 1.1%.

But Hong Kong’s Hang Seng Index (^HSI) lost 0.2%, ad the Shanghai Composite Index (000001.SS) lost 0.5%.