Reuters Insider - Brexit rally fizzles as deal faces hurdles

Baader Bank AG

17/10/2019 18:11

Click the following link to watch video: https://share.insider.thomsonreuters.com/link?entryId=0_vek0ajnv&referenceId=tag:reuters.com,2019:newsml_OVB1HQV0R_930&pageId=ReutersNews
Source: Reuters Insider

Description: Sterling surged and European stocks jumped after British Prime
Minister Boris Johnson and EU officials said a Brexit deal was done. But the
rally was short-lived. David Pollard reports.
Short Link: https://tmsnrt.rs/2VPuA1J

Video Transcript:

It was good while it lasted. Thursdays EU-UK agreement in Brussels rallied
sterling a full percent and shares to a year-and-a-half peak as investors
reversed out of safe havens including bonds. Yield surged as bunds, gilts and
others sold off. The moves triggering a wave of optimism on Europe's markets.
Baader Bank's Robert Halver: 

The danger of a no-deal on October 31st, on Halloween, is definitely off. In
an emergency, there will be a Brexit extension. But overall, Europe is happy
again. 
But Britain's Brexit deal isn't in the bag yet. Prime Minister Boris Johnson
still needs the approval of Parliament that may, or if the votes don't stack
up, may not come when it beats on Saturday, October 19. And has that doubt
began to sour the new mood, the pound fell back. After hitting a five-month
peak, just shy of $1.30, sterling slithered downwards again to a loss of 0.2%.
As for the volatility, Bill Blaine of Shard Capital says, "brace for more." 

There's not really enough time for Parliament to debate it properly and agree
what goes through. So, the only thing I can say with any certainty on Brexit
is it's going to remain very uncertain. 

The pan European STOXX 600 gave up most of its gains, though the pound slide
did boost the UK's export-heavy FTSE 100. For Britain's Brexit hardened share
traders, some clouds still have a silver lining