Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

FTSE Drowns As Covid-19 Restrictions Continue, GBP Surges On Brexit Talks Restart

Published 22/10/2020, 06:06
Updated 21/10/2020, 09:15

There was a divergence between the US and Europe this afternoon, while the pound rallied hard on the latest Brexit hopes.

Led to believe a pre-election stimulus package is still alive thanks to comments from Nancy Pelosi and Steven Mnuchin – despite strong Republican opposition – the Dow Jones was able to push 100 points higher after the bell, once again climbing past 28400.

That put it on the other end of the spectrum to its European peers. The increased prevalence of covid-19 restrictions in the UK and on the continent gripped investors on Wednesday. The DAX dove 0.9%, sinking to 12650, while the CAC lost 1.1% as it tumbled below 4900.

The FTSE was hammered as the session went on, plunging 100 points – or 1.7% – as it was set on a course for its worst close since the start of September.

The UK index’s miseries were two-fold. Firstly it was dealing with the same covid-19 crisis as its Eurozone cousins, including news that South Yorkshire has become the latest region to fall under the most severe ‘tier 3’ restrictions.

Secondly, the pound went wild thanks to a Bloomberg report stating that, after a few days of posturing from Boris Johnson and the like, Brexit talks are set to restart, with the intention of reaching a deal by mid-November. This after no. 10 described Michel Barnier’s recent comments – including his belief that a deal is ‘within reach’ – as ‘significant’.

Sterling really let rip, shooting 1.6% higher against the dollar and 1.2% against the euro. Cable is now trading above $1.3146 for the first time since September 8th, while against its single currency rival the pound is at a near one-week peak of €1.1086.

"Disclaimer: Spreadex provides an execution only service and the comments above do not constitute (or should not be construed as constituting) investment advice or recommendations, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any person placing trades based on their interpretations of the above comments does so entirely at their own risk. Spreadex Ltd is a financial and sports spread betting and sports fixed odds betting firm, which specialises in the personal service and credit area. Founded in 1999, Spreadex is recognised as one of the longest established spread betting firms in the industry with a strong reputation for its high level of customer service and account management.

In relation to spread betting, Spreadex Ltd is authorised and regulated by the Financial Conduct Authority. Spread betting carries a high level of risk to your capital and can result in losses larger than your initial stake/deposit. It may not be suitable for everyone, so please ensure you fully understand the risks involved."

Original Post

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.