Pound nears three-month low, stocks weak before Brexit speech

The pound hovered near three-month lows versus the dollar on Tuesday and stocks were mostly weaker as investors waited for British Prime Minister Theresa May to lay out plans to exit the European Union (EU) amid fears the United Kingdom will lose access to the single market. Safe-havens such as the yen, gold and Treasuries gained. According to her office, Ms. May was to say in a speech later in the day that Britain will not seek a Brexit deal that leaves it “half in, half out” of the EU, reinforcing fears of a “hard Brexit” that have pushed the pound to some of the weakest levels against the US dollar in more than three decades.

TOKYO — The pound hovered near three-month lows versus the dollar on Tuesday and stocks were mostly weaker as investors waited for British Prime Minister Theresa May to lay out plans to exit the European Union (EU) amid fears the United Kingdom will lose access to the single market.

Safe havens such as the yen, gold and Treasuries gained.

According to her office, Ms. May was to say in a speech later in the day that Britain will not seek a Brexit deal that leaves it “half in, half out” of the EU, reinforcing fears of a “hard Brexit” that have pushed the pound to some of the weakest levels against the US dollar in more than three decades.

Sterling hovered around $ 1.2070, in striking distance of $ 1.1983, its lowest since Oct. 7 struck the previous day.

Growing uncertainty over the policies of Donald Trump have also hurt equities. “Markets affected by the twin political black swans of 2016 — the Brexit vote and Trump win — remain volatile and uncertain,” wrote David Croy, senior rates strategist at ANZ.

US stock futures dipped 0.30%. Wall Street was closed on Monday for Martin Luther King Day.

Japan’s Nikkei brushed a fiveweek low and was last down 1.50%. Australia and Shanghai also suffered losses, but MSCI’s broadest index of Asia-Pacific shares outside Japan inched up 0.40%.

The euro nudged up 0.30% to $1.0642 to pare much of its overnight losses.

The yen benefited from its safe haven status, gaining versus the dollar, euro and sterling. The dollar was down 0.30% at ¥113.790, having gone as low as ¥ 113.610 the previous day, its weakest since Dec. 8.

Gold was helped by the heightened risk aversion stemming from Brexit and uncertainty over Mr. Trump’s plans.

Spot gold was $ 1,206.70 an ounce after climbing to $1,207.86 overnight, its highest since late November last year.

Crude oil was higher as Saudi Arabia’s steady commitment to reduce production offset a report forecasting US output would rise again this year.

US crude was up 0.20% at $52.46 a barrel.

Elsewhere, the price of US Treasuries rose, taking the yield on the benchmark 10-year note down by about 2 basis points. —