Wranglings over the length of the post-Brexit transition period are spooking the UK markets this morning and while the FTSE is just about keeping its head above the water the pound has dropped 1% against the dollar and 1.14% against the euro.
The ink on the ballot papers has barely dried off and Boris Johnson is now more assured of his position in 10 Downing Street but a new set of worries about the UK potentially crashing out of the EU without a trade deal is beginning to complicate things. The Prime Minister wants to add a new clause to the Brexit bill that would limit the transition period to the end of 2020 and would make it impossible to extend the period for up to two years, which is what the current agreement with the EU stipulates. But this could create a situation in which the UK would leave the EU without a trade deal and would be in a far more vulnerable position going forward. Investors are voting with their feet, selling off the most UK-focused stocks such as property firms and local banks.
Oil rallies, helps oil stocks higher
Oil prices have a new bounce in their step helped by the prospect of the Sino-US trade deal and OPEC’s recent decision to cut production for the next six months. Brent crude prices have risen above $65 helping the likes of Shell and BP, oil stocks which pushing to the top of the FTSE gainers this morning. Mining companies and utilities are also gaining ground.
This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.
GAIN Capital Singapore Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the GAIN Capital group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), GAIN Capital Singapore Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact GAIN Capital Singapore Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.
In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither GAIN Capital Singapore Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.
GAIN Capital Singapore Pte. Ltd. is not under any obligation to update this report.
Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.
Cryptocurrencies are not legal tender currency and trading of derivatives on Cryptocurrencies are currently not covered under any regulatory regime in Singapore. Consequently, investors should be aware they do not have protection under the Securities and Futures Act (Cap. 289). Please ensure that you are fully aware of the risks.