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Pound jumps as exit poll shows Conservative majority in British vote
NEW YORK, Dec 13, 2019 (BSS/AFP) – The pound sterling leapt higher on
Thursday after exit polls showed Prime Minister Boris Johnson’s ruling
Conservative Party on track to win a wide parliamentary majority, a result
seen as hastening Brexit.
Meanwhile, global stock markets rallied with Wall Street in record
territory following reports Washington and Beijing had at long last sealed a
partial trade deal and agreed to de-escalate their tariff battles.
The British exit poll suggested the Conservatives would win 368 seats in
the 650-seat parliament, with the main opposition Labour party trailing on
191.
Shortly after 2200 GMT, a pound rose about two percent against the dollar
$1.3416 and was up 1.6 percent against the euro at 83.25 pence.
“It gives Johnson the mandate to push over the Brexit,” said Shaun
Osborne, chief currency strategist at Scotiabank. “For the UK it provides
some clarity for the economy.”
Meanwhile in New York, stocks forged into record territory after media
reports indicated President Donald Trump would call off steep tariffs planned
for Sunday and slash duties already in place on Chinese goods.
The S&P 500 and Nasdaq both set new records.
“Getting VERY close to a BIG DEAL with China. They want it, and so do we!”
Trump tweeted early in the day, giving stocks a lift.
But Karl Haeling of LBBW told AFP the devil was in the details as
negotiation breakthroughs had appeared to fall apart before.
“We’ve been down this road before,” he said.
– ‘Wise owl’ at the ECB –
The ECB, meanwhile, gave markets little to trade on as Christine Lagarde
chaired her first monetary policy council meeting and held her news
conference in her new post.
The bank left interest rates unchanged and a maintained its massive bond-
buying program, as expected.
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ECB economists also came up with figures suggesting both an uptick in
inflation and “signs of stabilization in the growth slowdown,” which provided
the euro with some tailwind.
Lagarde said she would develop her own style and claimed to be neither
dovish nor hawkish but aimed to be a “wise owl.”
Still, Lagarde “came off as slightly hawkish,” OANDA analyst Edward Moya
said. “Lagarde seems poised to help take the eurozone out of negative rates.”
Asian equity markets mostly closed higher after the Federal Reserve on
Wednesday indicated it was unlikely to change US interest rates throughout
next year.
The US central bank, which cut the key borrowing rate three times this
year, said after a two-day meeting it would hold them for now and set its
sights on low inflation and the global economy.
– Key figures around 2200 GMT –
Pound/dollar: UP at $1.3470 from $1.3196 at 2200 GMT
Euro/pound: DOWN at 82.87 pence from 84.35 pence
Euro/dollar: UP at $1.1177 from $1.1130
Dollar/yen: UP at 109.30 yen from 108.56 yen
New York – Dow: UP 0.8 percent at 28,132.05 (close)
New York – S&P 500: UP 0.9 percent at 3,168.57 (close)
New York – Nasdaq up 0.7 percent at 8,717.32 (close)
London – FTSE 100: UP 1.0 percent at 7,287.00 points (close)
Frankfurt – DAX 30: UP 0.6 percent at 13,221.64 (close)
Paris – CAC 40: UP 0.4 percent at 5,884.26 (close)
EURO STOXX 50: UP 0.5 percent at 3,706.35 (close)
Tokyo – Nikkei 225: UP 0.1 percent at 23,424.81 (close)
Hong Kong – Hang Seng: UP 1.3 percent at 26,994.14 (close)
Shanghai – Composite: DOWN 0.3 percent at 2,915.70 (close)
Brent North Sea crude: UP 0.8 percent at $64.20 per barrel
West Texas Intermediate: UP 0.7 percent at $59.18
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