Sterling choppy amid uncertainty over Brexit talks and Covid lockdowns – as it happened

Rolling coverage of the latest economic and financial news, as EU leaders said Brexit talks would continue next week

The main market story has centred on investor reaction to Brexit talks after Boris Johnson urged the UK to prepare for no deal.

While EU counterparts suggested negotiations would continue next week, a spokesperson for the UK prime minister essentially said the EU shouldn’t bother unless the bloc fundamentally changes its stance.

US stocks are climbing in part due to vaccine hopes, after pharma giant Pfizer said it may apply for emergency use of its Covid vaccine as early as November.

The world is waiting for a safe and effective #COVID19 vaccine. Today our Chairman & CEO penned an open letter to help people understand the criteria we must meet and the expected timelines for our investigational vaccine program. https://t.co/RlhDYq4vK0

Assuming positive data, Pfizer will apply for Emergency Authorization Use in the U.S. soon after the safety milestone is achieved in the third week of November.

All the data contained in our U.S. application would be reviewed not only by the FDA’s own scientists but also by an external panel of independent experts at a publicly held meeting convened by the agency.

US stock markets have opened in positive territory:

Data flash: US industrial production has come in far lower than expected, having contracted 0.6% in September.

That’s compared with forecasts for 0.5% growth, according to a Reuters poll, and August’s growth of 0.4%

And yet again, the pound has tumbles to around-0.3% versus the dollar to 1.2881 after a spokesman for Boris Johnson reportedly said trade talks with the EU are over unless the bloc fundamentally changes its stance.

Reuters reports the spokesman as saying:

The trade talks are over: the EU have effectively ended them by saying that they do not want to change their negotiating positions.

There is no point in trade talks if the EU does not change its position. The EU effectively ended the trade talks yesterday. Only if the EU fundamentally changes its positions, will it be worth talking.

It’s easy to see why sterling is struggling to settle this afternoon, given that the UK’s ‘no-deal is looming’ statement is being interpreted as a sign of concession by others.

The latest comments from EU leaders comes from Dutch prime minister Mark Rutte. Reuters reports Rutte saying that he interprets Boris Johnson’s comments as a sign that Britain is prepared to compromise.

Fortunes have turned for US futures on the back of the stronger than expected retail sales:

Futures gaining in the pre-market after retail sales clobber expectations https://t.co/Vshxd2Niyi pic.twitter.com/i7PjIJFHLd

Data flash: US retail sales for September have comfortably beat estimates, having jumped 1.9% compared to a month earlier.

That compares to Reuters polls forecasting a 0.7% month-on-month rise.

Boris Johnson’s dismal Brexit update crucially did not rule out further talks with the EU, and markets are now taking cues from European leaders who said negotiations would continue in London next week.

It’s been a roller coaster ride for the pound this afternoon. After dropping more than 0.3% following Johnson’s comments, it’s now back in positive territory and is nearly up 0.1% at 1.2926.

Pret a Manger is to cut 400 jobs and close six more outlets in London after a slowdown in sales growth since September as coronavirus infection rates increased in the UK.

The coffee and sandwich shop chain has struggled to deal with the slump in commuter numbers since the pandemic struck, with branches in the City of London particularly hard hit.

It’s absolutely right that we take steps to stop the spread of the virus and tackle the new wave of infections. Sadly, the result of the rise in infections and the necessary shift in public health guidance mean that our recovery has slowed.

We’ve said all along that it’s up to Pret to decide our own future and that we must adapt to the new situation we find ourselves in. That’s why we have to make these further changes as we continue to transform our business model and prepare for the six months ahead.

Related: Pret a Manger to cut a further 400 jobs and close six more stores

The EU Commission president confirms Brexit negotiations are set to continue in London next week.

– talks: the EU continues to work for a deal, but not at any price.

As planned, our negotiation team will go to London next week to intensify these negotiations.

Neil Wilson, chief market analyst at markets.com says there is still a risk that the pound could drop below 1.27 against the US dollar, if investors find more reason to be pessimistic following Boris Johnson’s Brexit comments:

Sentiment will remain fragile with risk of pullbacks on negative headlines. Lots of noise for the day traders to latch on to but no trend emerging. Longs may struggle against this backdrop and a retest of the bottom of the range at 1.27 is a distinct possibility in the near term if today’s support cracks.

What it is: A clearly signposted and choreographed set piece, following in the wake of the Oct 15th deadline, which is designed to force the EU to back down. The UK wants to gain the upper hand in the talks and hopes fissures will open up between member states (Germany and France in particular) and that the EU will eventually crack and go for what the UK is offering.

It’s not entirely bluff – the UK would through gritted teeth accept a no deal because politically Johnson is taking so much flak over the pandemic that he has no room to ‘let the country down’ over Brexit.

The red/blue wall in the north has been hard hit by the pandemic – they would never vote Tory again if Boris backs down now over Brexit. And it’s pointedly not the UK walking away from trade talks – it’s important to lay blame at the feet of the other and Britain’s position has not materially altered.

For more on the political reaction to Boris Johnson’s statement, do follow our news live blog.

Related: Boris Johnson says UK should prepare for a no-deal Brexit and ‘Australia-style’ future – UK politics live

But in case you thought it was all over, some are taking Boris Johnson’s comments as potential posturing.

Reuters is reporting that the EU is getting ready for more trade talks in London next week, since the UK prime minister did not say explicitly he was walking away from negotiations.

Here’s a look at how the pound has reacted to Boris Johnson’s Brexit comments, and it’s continued to swing over the past 20 minutes:

More from our Brexit correspondent Lisa O’Carroll:

NEW NG: Boris Johnson : “since we have only 10 weeks until the end of the transition period. On January, the first. I have to make a judgment about the likely outcome, and to get us ..I’ve concluded that we should get ready for Jan 1 that are more like Australia’s”

Johnson hasn’t said he will walk away but just prepare for no deal
” it’s clear from the summit that after 45 years of membership. They are not willing, unless there’s some fundamental change of approach to offer these countries, the same terms as Canada. “

Johnson flipping it back to the EU – saying they have to come to us but not walking away.
“They’ve abandoned the idea of a free trade deal it doesn’t seem to be any progress coming from, from Brussels so what we’re saying to them is only, you know, come here, come to us”

The pound has lost all of its gains and is now trading down 0.3% against the US dollar at 1.2869 as comments from Boris Johnson suggest there is a growing likelihood of a no-deal Brexit.

Reuters is reporting Johnson as saying that the EU has abandoned the idea of a free trade deal and unless the EU makes fundamental changes to its approach, the UK will go for no deal.

Mining giant Glencore has called time on new coal mine projects, after promising to run down its existing stable of 26 mines without replacing them.

Glencore’s chief executive Ivan Glasenberg said the decision not to invest in replacing its old coal mines is part of the company’s plan to reduce the carbon emissions in line with the Paris climate agreement.

A couple hours out from the US open and futures are pointing to a mixed start to trading.

Over in the US, the stimulus hopes came back to life once again after House Speaker Nancy Pelosi showed more willingness to work with the House Democrats in order to address the stimulus need.

The economic conditions are deteriorating in the U.S. The Federal Reserve has even made it clear for the policymakers that they need to act as the U.S. economy needs a sizeable package—a small stimulus package is likely to harm the economy, according to the Fed Chairman, Jerome Powell.

Lancashire is reportedly going to be placed under the very high alert level tier 3 Covid restrictions.

Lancashire County Council spokesperson has confirmed Lancashire will move into Tier 3 restrictions which includes pubs and bars closing

Related: UK coronavirus live: Lancashire ‘to move into tier 3 Covid restrictions’

My colleague Rob Davies has been live tweeting the Wetherspoons press conference this morning, where chief executive Tim Martin has been criticising government Covid rules and explaining the company’s first ever loss.

Live Tim Martin feed from Wetherspoons press conference, for all you fans. https://t.co/lEtLye87Nw

“I’m not on social media so it’s quite shocking to read some of the comments.”

“People seem to believe our pubs are not clean.”

Says Spoons is top of the league tables for cleanliness.

“The truth is you certainly can catch Covid in a pub but it’s not the centre of transmissions.”

Here’s the science bit…concentrate!

“If you go out with 19 people who have Covid and social distance you’ll be fine. If you go out in a group of six and think you’re safe and start hugging everyone, you’ll get the virus.”

The Information Commissioner’s Office has fined British Airways £20m for failing to protect the personal and financial details of over 400,000 customers.

The ICO said the airline was processing a significant amount of personal data without having adequate security measures in place.

People entrusted their personal details to BA and BA failed to take adequate measures to keep those details secure.

Their failure to act was unacceptable and affected hundreds of thousands of people, which may have caused some anxiety and distress as a result. That’s why we have issued BA with a £20m fine – our biggest to date.

Facebook-owned Instagram is to crackdown on social media influencers and celebrities who make posts without telling followers when they have been paid to do so, following an investigation by the Competition and Markets Authority.

The CMA said it has been investigating the issue of so-called “hidden advertising” by social media influencers and has been concerned that Instagram has not been doing enough to tackle the problem.

For too long, major platforms have shied away from taking responsibility for hidden advertising on their site,” said “So, this commitment to tackle hidden adverts and overhaul the way people post on Instagram – making it difficult for users to ignore the law – is a welcome step forward.

These changes mean there will be no excuse for businesses to overlook how their brands are being advertised either – making life a lot harder for those who are not upfront and honest with their followers.

So, Brexiteer Nigel Farage has popped up again, this time with a daily newsletter meant to save subscribers cash.

In a tagline that sounds awfully familiar, his website claims people should subscribe to ‘Fortune & Freedom’ because “It’s time to take back control of your money.”

We cover everything from the benefits of holding gold, why the Euro looks doomed, the potential for cryptocurrencies and how cancel culture is making critical thinking and public debate toxic.

“gold is like insurance against monetary megalomaniacs at the Bank of England and Exchequer”

mmmmk

More from our retail correspondent Sarah Butler, following the John Lewis announcement earlier this morning.

John Lewis is to become a major landlord, aiming to build homes for rent at 20 sites it owns around the country as part of its new strategy to rebuild profits to £400m within five years.

JD Wetherspoon has slumped to a £95m annual loss as sales plunged during the coronavirus lockdown, with the pub chain’s outspoken founder renewing his criticism of the UK government’s restrictions to control the pandemic, my colleague Mark Sweney writes.

The chain, which reported a £95m profit in its previous financial year, said revenues slumped by 30.6% to £1.26bn as its pubs were hammered by the lockdown.

If pubs were, indeed, ‘centres of transmission’ it might be expected that infection rates would be higher among employees than those of either the general population or companies like Amazon.

Raab’s Brexit comments have lifted the pound, which has pared its losses and is now nearly flat against the US dollar at 1.2909.

UK foreign secretary Dominic Raab has claimed the UK is close to a Brexit deal.

However, speaking to Sky News this morning, Raab said he was disappointed by the EU’s demand that the UK give further concessions to secure a trade deal.

We’ve been told that it must be the UK that makes all of the compromises in the days ahead, that can’t be right in a negotiation, so we’re surprised by that but the prime minister will be staying more on this later today.

Having said that, we are close. With goodwill on both sides we can get there.

And we’re off! Here’s how stocks are looking at the EU market open:

The John Lewis Partnership has committed to spending £1bn over five years to accelerate its online business and transform its shops.

In a statement this morning, the company also pledged to increase its Waitrose delivery capacity to more than 250,000 orders per week, up from 55,000 before the pandemic.

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

While England gets to grip with new Covid-19 restrictions set to come into force under the government’s new three-tier system, investors are waiting to hear what’s next for Brexit talks.

The British government is under pressure to follow scientific advice for a 2-week circuit breaker national lockdown but has so far resisted, but has raised the capital to the Level 2 tier of restrictions. That means two different families can no longer mix indoors- be that in their home or in a pub or restaurant.

There is still no sign of the joint European recovery fund so in the meantime economies stand to take the hit – risking a double dip recession – from the new restrictions.

European Opening Calls:#FTSE 5876 +0.74%#DAX 12759 +0.44%#CAC 4885 +0.98%#AEX 563 +0.39%#MIB 19183 +0.62%#IBEX 6835 +0.26%#OMX 1826 +0.70%#STOXX 3209 +0.51%#IGOpeningCall

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