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Friday 26 April 2019

Pound falls after Bercow rules out third vote on May’s Brexit deal

The speaker said a vote cannot take place unless changes are made to the motion.

John Bercow said another vote on Theresa May’s EU withdrawal agreement cannot take place if the motion is substantially the same as last time (House of Commons/PA)
John Bercow said another vote on Theresa May’s EU withdrawal agreement cannot take place if the motion is substantially the same as last time (House of Commons/PA)

By Maryam Cockar, Press Association City Reporter

The FTSE 100 was boosted by the weaker pound on Monday, which declined after a third vote on the Prime Minister’s Brexit deal was ruled out by the speaker of the House of Commons.

London’s top index closed 70.91 points, or 0.98%, higher at 7,299.19 while Germany’s DAX fell 0.25% but France’s CAC rose 0.14%.

Sterling was down 0.66% against the US dollar at 1.322 and 0.52% lower versus the euro at 1.167.

John Bercow told the House that another vote on Theresa May’s EU withdrawal agreement cannot take place if the motion is substantially the same as last time.

MPs defeated Mrs May’s deal for second time last week, having rejected an initial version of her agreement in January.

Neil Wilson, chief market analyst at Markets.com, said the news was a “big blow for the Government as it effectively closes off another vote this week unless Mrs May can pull a rabbit out of the hat”, adding that any substantial changes to the deal seem unlikely ahead of the European Council meeting this week.

However, Mr Wilson noted that the Government had already rowed back expectations for a third vote and reports indicated that Northern Ireland’s Democratic Unionist Party, which is propping up Mrs May’s minority government, and the European Research Group were unlikely to back the Prime Minister.

The thing for traders in this kind of febrile atmosphere is that it’s not abundantly clear what this means. Does it raise or lower the prospect of a no-deal? Neil Wilson, Markets.com

“The thing for traders in this kind of febrile atmosphere is that it’s not abundantly clear what this means. Does it raise or lower the prospect of a no-deal?

“Does it make it more or less likely that an extension to Article 50 will be longer than the short three months? Tough times trading sterling right now,” he said.

In corporate news, JD Sports is to buy fellow retailer Footasylum in a deal valuing the company at more than £90 million.

It comes just a month after JD said it had no intention of making an offer despite acquiring a stake of 8.3% in the firm, which was later raised to more than 18%.

JD Sports shares rose 5.4p to 491.4p and Footasylum shares were up 34.9p to 81.4p.

Budget British airline easyJet pulled out of plans to form a consortium to bid for bankrupt Italian carrier Alitalia.

EasyJet said that following discussions with state-controlled railway Ferrovie dello Stato Italiane and Delta Air Lines about forming a consortium to “explore options” for Alitalia, it has now withdrawn from the process.

EasyJet shares fell 11p to 1,248p.

Meanwhile, in Europe Germany’s two biggest lenders Deutsche Bank and Commerzbank confirmed talks over a possible multibillion-euro merger as they look to turn around their fortunes.

A deal would bring together two banks that have struggled in recent years to create the second-biggest lender in the eurozone and may result in job losses.

Brent crude, the international benchmark, traded up 0.51% at 67.36 US dollars (£50.91).

The biggest risers on the FTSE 100 were Sainsbury’s up 11.1p to 234.9p, Intertek up 146p to 4,822p, BHP Group up 49.8p to 1,768.4p, and Rio Tinto up 116p to 4,267p.

The biggest fallers on the FTSE 100 were Paddy Power down 90p to 5,855p, Just Eat down 11p to 731.6p, Whitbread down 62p to 5,052p, and NMC Health down 32p to 2,624p.

Press Association

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