Financial markets trade lower amid Brexit concerns
Markets were lower yesterday as concerns about Britain’s departure from the European Union, Italy’s budget woes and the US-China trade relations weighed on investors.
The pound continued to weaken on Brexit uncertainty, withNorthern Ireland’s Democratic Unionist Party (DUP), which has been propping up the Conservatives in Parliament, refusing to back the Government in a series of House of Commons votes on the Budget.
The DUP say Mrs May’s EU withdrawal agreement reached in Brussels last week breaches a guarantee that Northern Ireland would not be treated differently from the rest of the UK.
Elsewhere, Bank of England governor Mark Carney has backed Theresa May’s EU withdrawal plans and warned a nodeal Brexit would be the “worst outcome”.
Sterling was down 0.3% against the US dollar at 1.281, but up 0.3% versus the euro to 1.125.
Meanwhile, the FTSE 100 index fell 52.97 points, or 0.76%, to close at 6,947.92.
David Madden, market analyst at CMC Markets, said: “Investment sentiment has been slipping recently as worries about Italy, Brexit and US-China trade relationship have prompted traders to become risk-adverse.
“Today, we are seeing a widerange sell-off as global sentiment has taken another turn for the worst.”
In Europe, the French Cac was down 1.2% while the German Dax dropped 1.6%.
In corporate news, lender CYBG swung to a full-year loss after it was forced to take an extra £150m charge linked to the misselling of payment protection insurance.
The group, which owns the Clydesdale and Yorkshire banks, booked a £164m pre-tax loss in the year to September 30, compared with a £268m profit in 2017.
Global catering giant Compass backed Theresa May’s Brexit deal as being “better than no deal” as it revealed plans to begin stockpiling food if the UK looks on course to crash out of the EU.
The group, which is the world’s biggest catering firm, warned in its full-year results over the risks of a no-deal Brexit to its food supply and workforce.
Ei Group, the UK’s largest owner and operator of pubs, is preparing for a potential sale of its commercial property portfolio, in a deal which could be worth more than £400m.
A barrel of Brent crude was down 0.6% at 63.31 US dollars (£49.44) following concerns about supply.
Mr Madden said: “US stockpiles are rising, the global economy is slowing and there is a perception that future demand will be weak.
“To add to the mix, production from Libya has soared, and there is talk that production could be ramped up even further.”
The biggest risers on the FTSE 100 were Compass Group up 85.50p to 1,673p, Just Eat up 16.60p to 550.40p, Halma up 39p at 1,350p and 3i Group up 23p at 832.6p.
The biggest fallers on the bluechip index were Evraz down 33.20p to 515.2p, EasyJet down 64.50p to 1,110.5p, Ashtead down 89.50p to 1,708.5p and GVC down 33.50p to 746.5p.