Rebound Wednesday
Fiona Cincotta September 9, 2020 9:36 AM
FTSE rebounds as weaker pound overshadows AstraZeneca
US tech stocks were in the firing line once again overnight with the Nasdaq weathering a 4% drop whilst Tesla tanked over 20%. The selloff in the tech heavy Nasdaq took the Nasdaq into correction territory for the second time this year.
Brexit Hits Pound
The UK today will release its internal markets bill which has caused some controversy. Whilst the British government is painting this to be a tweaking round the edges of the Brexit withdrawal agreement and a clarifying of trade between the UK and Ireland, the EU is seeing this through a very different set of eyes. The EU is viewing this as an overriding of an international treaty and breaking international law, making the UK government appear very untrustworthy.
This latest development in the Brexit story is having a huge a big impact on GBP which has plunged over 1.3% yesterday and is off further today. GBP/USD trades over 2.3% lower this week so far, unwinding gains across the past month. A
There is a good chance that the Pound could extend losses now as we head towards the October 15th deadline as the reality of a no trade deal Brexit starts to hit home. Up until now there had been an assumption that the EU and the UK would pull the cat out of the bag and agree a deal at the last minute. Any tampering with the Brexit divorce bill would means the chances of a trade deal are significantly lower.
FTSE Chart
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