Trade tensions, PM's future and elections weigh on markets

The FTSE is trading lower and the pound is 0.4% weaker as the Prime Minister’s future hangs in the balance and European elections start.

The FTSE is trading lower and the pound is 0.4% weaker as the Prime Minister’s future hangs in the balance and European elections start.

The PM is preparing to publish a revised Brexit deal on Friday giving MPs the chance to consider it before a vote on 7 June. However, time could run out on her as senior Tory MPs are planning to move against her before the end of the week unless she abandons the vote plans.

Sterling declines on political uncertainty

The question of who will be in Downing Street in June is playing out against the backdrop of European elections which for the UK will be an indirect vote on Brexit. It will take until Sunday for a final tally of the vote and the wait is causing the euro to lose some ground against the dollar. 

The PM’s uncertain future is unsettling sterling trade and the pound is slipping to one of its lowest levels this year.

Percolating US-China trade issues hit Wall Street at the close yesterday and have caused Asian shares to slump to their lowest level in four months. 

The FTSE followed suit this morning with a 0.7% decline before it started turning the corner a little. Travel companies, super markets and food delivery services are among the biggest fallers this morning. The oil market also couldn’t escape the rising trade tensions causing Brent Crude prices to lose 0.9% to trade just above $70.

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