Pound Drops As Brexit Deal Support Unravels

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Markets are poised to move as the UK government’s Brexit deal unfolds with Prime Minister Theresa May making a statement to Parliament.

Brexit secretary Dominic Raab and Work and Pensions Secretary Esther McVey have resigned together with a clutch of junior ministers and a parliamentary secretary.

Raab, Britain’s Brexit senior negotiator said: “The first is that the terms being offered by the EU threaten the integrity of the United Kingdom and the second is that they would lead to an indefinite if not permanent situation where we’re locked into a regime with no say over the rules being applied, with no exit mechanism.

“I think that would be damaging for the economy but devastating for public trust in our democracy.”

But May has won the begrudging support of her Cabinet for the draft divorce deal.

In the House, opposition has mounted from all sides and she seems to have few supporters.

Trade tensions ease

Elsewhere, Chicago saw the fifth day in a row of losses for the S&P 500 based on the volatile price of oil and retreats in financial stocks.

But markets around the Asia Pacific relaxed as news of a letter from Beijing to Washington emerged signalling a possible easing of the trade tensions between China and the US.

The Pound took a trouncing on course for the biggest drop in a day this year.

Sterling is 1.5% down against the US dollar at $1.2795 and 1.39% down against the euro at 1.1331.

The reduction looks tied to the number of ministers resigning and may drop still further before the day is out.

The decline for UK markets and the Pound may not be a bad thing as a rebound is expected if May manages to navigate her Brexit deal through Parliament over the coming weeks.

Market data

Exchange% changeValueMovement
LONDON
FTSE 1000.18%7046.2312.44
FTSE 250-0.94%18732.87-177.27
Amsterdam
AEX-0.36%525.26-1.88
Paris
CAC40-0.37%5050.02-18.83
Frankfurt
DAX-0.05%11406.51-6.02
STOXX50-0.17%3199.83-5.53
Madrid
IBEX35-0.27%9081.90-24.70
New York
Dow Jones-0.81%25080.50-205.99
NASDAQ-0.90%7136.39-64.48
Chicago
S&P500-0.76%2701.58-20.60
Bombay
BSE Sensex0.34%35260.54118.55
Hong Kong
Hang Seng1.75%26103.34448.91
Tokyo
Nikkei-0.20%21803.62-42.86
Shanghai
Shanghai Composite-0.68%2,641.34-18.01

Source: BBC

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