LONDON MARKETS: London Markets Lifted By Weak Pound; Brexit And Trade Talks Loom
February 11 2019 - 4:59AM
Dow Jones News
By Emily Horton
Weak growth data weighs on sterling
London markets rose Monday, lifted by a weaker pound, which
sagged over increasing concerns over Britain's exit from the
European Union and fresh data showing sluggish growth in the final
quarter of 2018.
Investors will also keep an eye on trade talks between the Trump
administration and China, set to start in Beijing on Monday.
Oil, banking and mining sectors all climbed.
How are markets performing?
The FTSE 100 climbed by around 1% to 7,140.68, after finishing
the previous week up 0.7%. This jump was aided by a weak pound ,
which fetched $1.2899 from $1.2942 seen late Friday in New
York.
"The index of leading U.K. shares tends to benefit from a
falling pound as it boosts the relative value of its constituents'
largely overseas earnings" Russ Mould, investment director at AJ
Bell, added.
What's driving the markets?
Brexit talks between the U.K. and Brussels are set to begin
again on Monday. However, the chances of a disorderly exit from the
EU continue to mount, with only seven weeks left until the U.K. is
set to leave, and little room for negotiations over the previously
agreed draft withdrawal treaty.
In an attempt to patch up parliament's political deadlock, Prime
Minister Theresa May has reached out to leader of the opposition
Jeremy Corbyn
(http://www.marketwatch.com/story/brexit-brief-prime-minister-may-wants-opposition-talks-as-soon-as-possible-2019-02-11)calling
for cross-party Brexit collaboration and offering new concession
suggestions to the Labour Party.
Trade talks are set to continue between China and the U.S. in
Beijing on Monday. However, the U.S. team of negotiators will not
include President Donald Trump, but instead will be headed by
Robert Lighthizer and Steven Mnuchin, after Trump made it clear he
will not be meeting with President Xi Jinping before the trade deal
deadline of March 1.
Meanwhile, official data
(http://www.marketwatch.com/story/uk-economy-slows-in-2018-dogged-by-brexit-fears-2019-02-11)
released on Monday revealed a series of blows to the U.K.'s
economy, with 2018 growth up 1.4%, the weakest pace of growth since
2012. Gross domestic product rose at an annualized pace of 0.7% in
the three months through December, down from 2.5% in the third
quarter. In December alone, gross domestic product dropped by
0.4%,
What shares were active?
TUI AG led the FTSE 100's risers, adding nearly 5% and
reclaiming some lost ground after last week's tumble.
HSBC Holdings PLC (HSBA.LN) added 1.5%, and Lloyds Banking Group
PLC (LLOY.LN) climbed by just under 1%. However, the Royal Bank of
Scotland Group PLC (RBS.LN) lost nearly 2%, as the bank prepares to
announces its second annual profits on Friday.
Among heavyweight major oil companies, Royal Dutch Shell PLC
(RDSA.LN) rose by 1.4% and BP PLC (BP.LN) added 0.8%. Meanwhile,
miner Fresnillo PLC (FRES.LN) rose by 2%, Rio Tinto PLC (RIO.LN)
jumped by 1.7%.
(END) Dow Jones Newswires
February 11, 2019 05:44 ET (10:44 GMT)
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