Market Round Up: Brexit Fudge Fix 📈 – Pre Labor Day Anxiety 🎇

by | 31 Aug, 2018

 

1. Brexit Fudge Fix

Post Brexit trading confidence for UK companies took a dive according to a survey released by Lloyds Bank, painting a dark picture for the country’s future when it goes-it-alone next Spring.

Interestingly this mood is in contrast to an expected consensus that consumer confidence is on the up, and rumours from the EU27 leaders that a deal must be done – even it has to be ‘fudged’. What is known as the Chequers plan, although unloved by both sides of the UK political spectrum and the EU negotiators, may just end up being the most realistic compromise. That mainly means pretending the Irish border issue doesn’t exist.

The mood for now is that come October’s European Council meeting a transition agreement will be agreed by the UK and all the other 27 members of the EU whereby the UK stays in the Single Market and customs union – for a while longer! Along with the EU’s chief negotiator Michel Barnier’s positive tone in the past couple of days, this has helped reflect an uptick in Sterling while the FTSE 100 index saw a dip; which is explained by the high number of constituent company member’s high dependency on exports.

Related: Market Round Up: Baidu’s Made in China, Brexit in the City, Factory orders give a pep

 

2. Labor Day Cheer?

An Oval Office interview brought trade tensions back in to focus when President Trump threatened to pull out of the World Trade Organisation (WTO) and stated that the U.S. had the upper hand in trade disputes with China. To add fuel to the fire, Trump announced plans to impose new tariffs on China as soon as next week, sending markets into a frenzy as geopolitical tensions mounted.

Meanwhile the VIX, a key index of of short term investor mood, rose to a two-week high, while there was the inevitable pre-holiday risk sell-off that was accentuated by Trump’s WTO threat.

Happy Holiday!

Related: The EU signals it may be ready to compromise with US over tariff dispute

 

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ALL RIGHTS RESERVED © INVSTR LTD. 2018

Risk Disclosure:
Invstr is a technology platform, not a registered broker-dealer or investment adviser. Invstr does not offer its own recommendations of any security or provide its own research to any user regarding any security transaction or order.
Please note, investing involves risk and investments may lose value. Past performance does not guarantee future results.
Brokerage services are provided by the following:
US-traded securities, including fractional trading, are provided to Invstr users by DriveWealth LLC, a regulated member of FINRA/SIPC. DriveWealth may not establish investment accounts to residents of certain jurisdictions. For more information, including disclaimers, risk and transaction fees click here.
India account traded securities are provided by SIC Stocks & Services PVT Ltd. SIC does not make any personal recommendations to buy, sell or otherwise deal in investments. Investors make their own investment decisions. The services and securities provided by SIC may not be suitable for all customers and, if you have any doubts, you should seek advice from an independent financial adviser. For more information and disclaimers, click here.

 

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