Sterling enjoys a moment of calm before prorogation decision and new EU deadline
|FTSE dips but recovers on earnings
The FTSE opened lower but shortly afterwards started recovering as Diageo reported a good start to its financial year and Next showed an increase in pre-tax profits and maintained its profit guidance. The cautiousness in the market is a reflection of the unresolved Brexit issues and investors holding back before hearing from Mark Carney later this afternoon. The BoE is likely to sit on its hands this time, until it hears whether Parliament will be back in session imminently, if there will be a general election and if Brexit will be postponed.
Sterling enjoys a moment of calm before prorogation decision and new EU deadline
Today marks the third and final day in the Supreme Court hearing on the legality of the suspension of Parliament and the judges could come to a decision as soon as late Thursday or before the weekend. The pound is a little bit more stable this morning, trading above 1.247 against the dollar in what could be the calm before the next political storm, which is coming in the shape of the new Brexit deadline of September 30. The EU has given Boris Johnson until the end of the month to submit a written Brexit proposal but this may prove difficult for the PM as it coincides with the beginning of the Conservative Party conference in Manchester.
Brent inches higher as US readies for another set of sanctions on Iran
Brent crude is in a fragile equilibrium this morning, trading a whisker above $64. However, late Wednesday the US decided to impose a new set of sanctions on Iran following the drone attack on Saudi oil facilities last weekend. The US had held back until Saudi Arabia confirmed that it believed Iran was behind the attacks but now the new sanctions are likely to be put in motion before the weekend. No details are available yet but once they are, the oil market could nudge another step higher.
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