Market Brief: Farage’s Brexit party will not contest Conservative-held seats
Fawad Razaqzada November 11, 2019 7:45 AM
- The new week has begun with slight risk off tone. At 12:00 GMT, the major European stock indices were down across the board, with the FTSE down more than 1% thanks to a big spike in GBP. US index futures pointed to a lower open on Wall Street. Safe-haven gold was rebounding slightly after it suffered its worst week in 3 years last week. In FX, the pound was the strongest major currency, while the Aussie brought up the rear.
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- The biggest news today has been a political one: Nigel Farage said his Brexit party will NOT contest the Conservative-held seats but will do so for Labour amid concerns over a second referendum. This is a major boost for PM Boris Johnson’s Brexit deal, and GBP bulls who favour a soft exit from the EU.
- Meanwhile, the UK economy avoided a technical recession, eking out a growth of 0.3% in third quarter following a 0.2% contraction in Q2. However, expectations were for a slightly stronger GDP reading of 0.4%. Meanwhile manufacturing production fell by 0.4% m/m, disappointing expectations of a smaller 0.2% decline. This weighed on industrial output, which fell by 0.3% m/m. Construction output at -0.2% was better than -0.5% anticipated, however.
- It looks set to be a quieter afternoon, at least from a data perspective, with the US and Canada observing Veterans/Remembrance Day.
- Things should pick up as the week wears on - HERE is our week ahead preview.
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