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Stocks stall ahead of US earnings

On the day that Britain avoided Brexit, for the second time, London stocks are trading slightly stronger but in a somewhat subdued fashion reflecting the temporary respite on the political scene where everybody is gathering breath before the next storm.

With parts of the Tory party infuriated by the Brexit delay there is now talk about a summer leadership contest and mounting pressure on Theresa May to leave her post. Even with the leadership contest threat there is absolutely no clarity on how this would affect the Brexit process and even if the Conservative Party will be able to agree internally on where Brexit should be heading. 

Mixed signals dominate FTSE trading

On the FTSE declines from British American Tobacco and several metals companies are being balanced out by increases in food, drink and other consumer orientated companies. The FTSE’s upward move is also subdued because of caution over the oncoming US reporting season due to kick off later today with results from JP Morgan Chase and Wells Fargo Friday.

Unlike last year when the banks’ earnings showed spectacular increases and heralded a strong set of corporate earnings across US blue chips this quarter is expected to show the first contraction in the S&P 500 index since 2016.

Sterling is in the doldrums against the euro as the common currency perked up on Brexit being extended till the end of October, but is a notch firmer against the dollar.


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