Left Menu
Development News Edition

UPDATE 3-European shares soar on rising hopes of Brexit, trade deal

Reuters | Updated: 11-10-2019 22:48 IST | Created: 11-10-2019 22:47 IST
UPDATE 3-European shares soar on rising hopes of Brexit, trade deal
Image Credit: Pixabay

European shares were on a tear on Friday as a surprise breakthrough in Brexit negotiations drove UK-focused London-listed companies and the Irish index about 4% higher, while German shares logged their best day in nine months.

London-listed companies with exposure to the domestic economy swung to a premium over the exporter-heavy blue-chip index for the first time since May, in a reversal of fortune for the much-shunned market. The mid-cap index posted its best day since May 2010, while the Irish bourse, seen as a barometer for Brexit sentiment, had its best session since June 2016.

JP Morgan's UK domestic plays index, which was created in 2017 and tracks about 30 UK stocks that make all or most of their revenue at home, ended 7.7% higher, its best performance on record. "Markets are increasingly narrowly driven, this means that every piece of good news is going to propel markets strongly higher," said Marija Veitmane, senior strategist at State Street Global Markets.

"However, we are yet to see concrete details on the deal. We expect markets to sell off sharply should those hopes be disappointed." UK Prime Minister Boris Johnson and his Irish counterpart unexpectedly said overnight that they had found a pathway to a possible deal over Britain's departure from the European Union after three years of crippling uncertainty.

But any deal would need approval from the British parliament, which Johnson suspended unlawfully last month and in which he has no majority. Britain and the EU agreed to hold intense talks over the next few days in a bid to secure a deal, but arrangements around British-Irish border controls remain at issue, the EU said.

The pan-European STOXX 600 index rose 2.3% with most major European indices gaining more than 1.5%. The German index, packed with automakers exposed to UK demand, jumped 2.9%. SAP, Europe's most valuable tech company, also contributed to gains in Frankfurt, rising 10% for its best day since April after releasing strong third-quarter results and saying its long-term CEO had stepped down.

Rising hopes of top-level trade talks between the United States and China yielding a partial trade deal and a delay in planned U.S. tariff increases also brightened sentiment. U.S. Treasury Secretary Steven Mnuchin, Chinese Vice Premier Liu He and other senior officials concluded discussions on Friday.

The banking index, led broad-based gains, up 5% for its best day since April 2016 and with British lenders CYBG , Lloyds and Royal Bank of Scotland among the top gainers. Publicis tumbled 14.5% to a seven-year low after the ad firm lowered its full-year sales target for the second time in 2019. Its London rival WPP lost 3.4%.

Fashion house Hugo Boss sank 13.5% to its lowest in almost 9 years after the company cut its 2019 earnings forecast and reported third quarter results below expectations. The numbers came hard on the heels of a strong sales update from Louis Vuitton owner LVMH on Thursday.

Also Read: UK PM Johnson: No Irish border posts, but will need checks somewhere


TRENDING

OPINION / BLOG / INTERVIEW

Uganda COVID-19 response: Was off to a good start but reopening dwindled prospects

Uganda has shown success in using health information to enhance efficiency of disease surveillance, reporting and monitoring. The success, however, has critical challenges confronting it as the country resumes normal activities....

New farm bills in India: Focusing on farms or farmers?

... ...

Kenya’s COVID-19 response: Chaos amid lack of information

Confusing numbers and scanty information on how effective curfews and lockdowns have been in breaking transmission have amplified coordination and planning challenges in Kenyas response to COVID-19. Without accurate data, it is impossible t...

Farkhad Akhmedov: Calculating the price of impunity from the law

In insistences such as the battle over the Luna, Akhmedov has resorted to extreme legal machinations to subvert the High Courts decision and keep his assets from being seized. ...

Videos

Latest News

German minister expects 20,000 new daily coronavirus cases at end of week

The number of new coronavirus infections in Germany is likely to reach 20,000 a day at the end of this week, Economy Minister Peter Altmaier said on Tuesday. We are dealing with exponential growth, Altmaier told a German-French economic con...

All Pakistan, Zimbabwe players test negative for coronavirus ahead of ODI, T20I series

Pakistan Cricket Board PCB on Tuesday said that the players and player support personnel of Zimbabwe and Pakistan were tested for coronavirus and all tests returned negative. PCB said a total of 107 Covid-19 tests were conducted which also ...

MHA notifies UT of J-K Reorganisation (Adaptation of Central Laws) Third Order, 2020, repeals 12 laws out of 26

The Ministry of Home Affairs MHA has notified the Union Territory UT of Jammu and Kashmir Reorganisation Adaptation of Central Laws Third Order, 2020. The Centre has given repealed or substituted 26 state laws. In the third order, Ministry ...

American citizen kidnapped in southern Niger, sources say

An American citizen was kidnapped near the town of Birnin Konni in southern Niger in the early hours of Tuesday morning, three security sources and a local official told Reuters.The details of the kidnapping were not immediately clear, and ...

Give Feedback