Now that the UK has made formal their intention to withdraw from the EU, a two-year window of negotiations has begun during which both parties will furiously attempt to thrash out the details of the separation. As was widely expected, there was minimal reaction in the markets to Wednesday’s news with the pound oscillating around the 1.24 handle against the US dollar whilst the FTSE recovered from some early weakness to end the day little changed.
Two stages to the negotiations?
One of the first matters to be discussed at the negotiating table will be the sequence in which the negotiations themselves will play out. The UK has made clear its preference for simultaneous discussions relating to the two main topics at hand, namely the terms of the divorce settlement and the future trading relationship between both parties. However there’s a growing feeling that the EU is unwilling to discuss future trade deals until the details of the separation are clear and they may look to leverage their position here to gain a more favourable deal. Prime Minister Theresa May is expected to publish a white paper on the Great Repeal Bill today which should outline the manner in which UK law will assume all the EU rules and regulations that applied at the time of Brexit. This is seen as a positive for business as it will create certainty for business over the short-term because the existing rules will not suddenly change.
Accounting woes continue for BT
One of the worst performing stocks on the FTSE 100 this morning is BT, with shares in the telecommunications firm lower by around 1.5%. The firm is trying to find a new auditor after deciding to ditch PWC in the wake of a £530m accounting scandal in the Italian arm of its business. Morrisons Supermarkets is enjoying a decent rise in its stock this morning of almost 2% after an upgrade from US broker Bank of America Merrill Lynch. Advertising giant WPP has also benefitted from an upward revision to its rating from the same broker and is up by almost 1% on the day. Overall the leading UK stock index is little changed this morning and lower by 2 points at the time of writing as it seeks to recoup some of last weeks losses.
CFD’s, Options and Forex are leveraged products which can result in losses that exceed your initial deposit. These products may not be suitable for all investors and you should seek independent advice if necessary.
Recommended Content
Editors’ Picks
AUD/USD holds above 0.6500 in thin trading
The Australian Dollar managed to recover ground against its American rival after AUD/USD fell to 0.6484. The upbeat tone of Wall Street underpinned the Aussie despite broad US Dollar strength and tepid Australian data.
EUR/USD comfortable below 1.0800 lower lows at sight
The EUR/USD pair lost ground on Thursday and settled near a fresh March low of 1.0774. Strong US data and hawkish Fed speakers comments lead the way ahead of the release of the US PCE Price Index on Friday.
Gold pulls away from daily highs, holds above $2,200
Gold retreats from daily highs but holds comfortably above $2,200 in the American session on Thursday. The benchmark 10-year US Treasury bond yield stays near 4.2% after upbeat US data and makes it difficult for XAU/USD to gather further bullish momentum.
Google starts indexing Bitcoin addresses
Bitcoin address data is live on Google search results after users realized on Thursday that the tech giant started indexing Bitcoin blockchain data. However, mixed reactions have followed the tech giant's reversed stance on the cryptocurrency.
A Hollywood ending for fourth quarter GDP
The latest revisions put Q4 GDP at 3.4%, the second fastest quarterly growth rate in two years. Much of the upside was attributable to stronger consumer spending, yet fresh profits data affirmed it was a good quarter for the bottom line as well with profits up by the most since the Q2-2022.