LONDON MARKETS: London Markets Climb After Parliament Rule Out A No-deal Brexit; Miners Slip On China Data
14 März 2019 - 02:00PM
Dow Jones News
By Emily Horton
Royal Bank of Scotland, TUI, Cineworld active
London markets were up on Thursday, after U.K. lawmakers voted
on Wednesday night that Britain should not leave the European Union
without a withdrawal agreement in place.
Fresh industrial data from the Chinese government confirmed
investor fears that the world's second largest economy was
slowing.
U.K. listed heavyweight banks gained on the FTSE 100, while
mining companies struggled.
How did markets perform?
The U.K.'s FTSE 100 climbed by 0.7% to 7,211.96, after finishing
up 0.1% on Wednesday.
On Wednesday evening, U.K. parliament voted against the prospect
of a no-deal Brexit, leading the to an overnight surge in the pound
(http://www.marketwatch.com/story/british-pound-hits-9-month-high-after-parliament-takes-no-deal-brexit-off-table-2019-03-13).
However, by Thursday the pound had retracted pulled back from a
9-month high
(http://www.marketwatch.com/story/dollar-snaps-losing-streak-british-pound-pulls-back-from-9-month-high-2019-03-14)
reached the day before, fetching $1.3236 from $1.3337 late on
Wednesday night in New York.
(http://www.marketwatch.com/story/dollar-weaker-as-british-pound-bounces-higher-ahead-of-hard-brexit-vote-2019-03-13)
What's driving the markets?
The decision
(http://www.marketwatch.com/story/british-parliament-rejects-any-no-deal-brexit-16-days-before-deadline-2019-03-13)
that the Britain should not leave the European Union without a
withdrawal deal in place was welcomed by sterling traders. However,
this vote does not remove the risk of the U.K. crashing out of the
EU completely.
"The fact is that it is comforting to know that no deal Brexit
scenario is off the table, but at the same time there is no table,"
Naeem Aslam, chief market analyst at Think Markets UK, told clients
in a note.
"This is because May's party is in more disarray and Brexit has
become a laughing matter for everyone. Unfortunately, the law
makers in the UK are like headless chickens with no clue which way
to go. This element is going to keep the lid on the sterling
price," said Aslam.
U.K. lawmakers are set to vote again on Thursday, this time on
whether to delay the scheduled departure on March 29.
Meanwhile, the decline of China's economy was compounded by the
country's weakening industrial economic figures
(http://www.marketwatch.com/story/china-slowdown-broadens-despite-beijings-support-2019-03-14),
released by the government on Thursday.
What stocks are active?
Heavyweight banks Royal Bank of Scotland PLC (RBS.LN) rose 1%
and Lloyds Banking Group PLC (LLOY.LN) added over 2%.
Mining companies led the downside, given that the sector is
sensitive to news on China's economy, as the country is a big buyer
of natural resources. BHP Billiton PLC (BHP.AU) (BHP.LN), Rio Tinto
PLC (RIO.LN) (RIO.LN) and Glencore PLC (GLEN.LN) (GLEN.LN) all saw
losses of 1% or more.
Away from the main index, Cineworld Group PLC (CINE.LN) jumped
over 6% after posting profit that more than doubled last year
(http://www.marketwatch.com/story/cineworld-profit-soars-on-regal-entertainment-deal-2019-03-14),
helped by its acquisition of Regal Entertainment Group.
The potential [for Cineworld] to make cost savings was always
one of the main drivers of the Regal purchase and the company said
today savings would be even better than previously expected at
$150m this year. Better still for investors was the news that the
dividend has been raised by 18% and will be paid in quarterly
installments in the future" Ian Forrest, investment research
analyst at The Share Centre said in a note to clients.
Travel company TUI AG (TUI1.XE) gained just under 2%, while
aerospace company BAE Systems (BA.LN) climbed 1%.
Meanwhile, heavyweight miner Anglo American (AAL.LN) was the
FTSE's biggest loser, falling by 3%.
(END) Dow Jones Newswires
March 14, 2019 08:45 ET (12:45 GMT)
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