LONDON MARKETS: Brexit Hopes Fuel Fresh Rally For The British Pound To Highest Level Of Johnson Administration
By Steve Goldstein, MarketWatch
U.K. bank stocks surge, with RBS surging 17%
Growing hopes that U.K. and European leaders can reach an agreed
deal for Britain to leave the European Union pushed the British
pound higher for a second day on Friday.
The pound rose as high as $1.2663, up from $1.2444 on Thursday,
a day when the U.K. currency had its best single day percentage
advance since March.
It's the strongest sterling has been since Theresa May was prime
minister. Boris Johnson stepped into the No. 10 Downing Street on
European Council President Donald Tusk -- who has tweeted
criticism at British Prime Minister Boris Johnson -- on Friday said
he received promising signals from Ireland's Leo Varadkar that a
deal is possible.
The Times newspaper reported that Johnson on Thursday gave some
ground on the issue of Northern Ireland.
The European Commission meanwhile said Michel Barnier had a
"constructive" meeting with Brexit Secretary Steve Barclay on
Friday. The European Union says it has agreed with the United
Kingdom to "intensify" Brexit negotiations in a belated attempt to
reach a divorce deal ahead of Oct. 31, when Britain is scheduled to
leave the bloc.
"The change in tone yesterday from the Irish government and the
silence on the U.K. side indeed suggests the U.K. has made some
notable concessions," said analysts at Citi, who said they remained
skeptical a deal can be reached by Oct. 31, and that the more
likely path is an extension of the Article 50 deadline and a
The pound's strength weighed on U.K. stocks, as the FTSE 100
rose 0.70% to 7236.21, which isn't as strong as the rise made by
European rivals. Read Europe Markets
The Brexit hopes did lift U.K. banks Royal Bank of Scotland
(RBS.LN) , which surged 17%, and Lloyds Banking Group (LLOY.LN) ,
which rose 14%. The big multinational pharmaceuticals lost ground,
with GlaxoSmithKline (GSK.LN) falling 1.3% and AstraZeneca (AZN.LN)
(END) Dow Jones Newswires
October 11, 2019 08:55 ET (12:55 GMT)
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