Tuesday 23 July 2019

Pound struggles for direction as Theresa May outlines Brexit ‘Plan B’

Sterling moved lower against the US dollar as the Prime Minister addressed Parliament, but then rose.

MPs are due to vote on Mrs May’s Plan B on January 29 (Kirsty O’Connor/PA)
MPs are due to vote on Mrs May’s Plan B on January 29 (Kirsty O’Connor/PA)

By Maryam Cockar, Press Association City Reporter

The pound struggled for direction on Monday as the Prime Minister attempted to salvage her Brexit deal in Parliament a week after MPs voted it down by a majority of 230.

Sterling moved lower against the US dollar as Theresa May addressed MPs but then pushed higher.

The pound was up 0.15% against the US dollar at 1.290 and was up 0.2% versus the euro to 1.134 at the London market close.

Speaking in the House of Commons, Mrs May scrapped the £65 registration fee for EU nationals who apply for settled status and said those who had already paid the fee would be reimbursed.

She also said she would hold further talks with the Democratic Unionist Party (DUP) and others to avoid a hard border between Northern Ireland and the Republic of Ireland but refused to rule out a no-deal Brexit.

MPs are due to vote on Mrs May’s Plan B on January 29 and Fiona Cincotta, senior market analyst at City Index, said if that deal fails “to make it through the House of Commons, traders will hope that an extension to Article 50 will quickly follow”.

“Otherwise the UK will be crashing out of the European Union just two months later with no deal.”

Meanwhile, the FTSE 100 was flat ahead of Mrs May’s speech and closed just 2.26 points, or 0.03%, higher at 6,970.59. Germany’s DAX fell 0.7% and France CAC was down 0.3%.

In corporate news, William Hill expects full-year profits to drop 15%, with the bookmaker blaming conditions on the high street.

The bookmaker said adjusted operating profit is set to come in at £234 million, lower than last year but in line with expectations and within the previously guided range of £225 million to £245 million.

Shares in William Hill closed down 2.9p to 172.9p.

GlaxoSmithKline chairman Philip Hampton is to step down from the drugmaker, just a month after the firm fired the starting gun on its break-up.

The pharmaceutical giant said Mr Hampton, who was appointed non-executive chairman in 2015, has “informed the board of his intention to step down” and the search for his successor has begun.

Shares in GSK fell 6.6p to 1,492p.

Just Eat announced that chief executive Peter Plumb is to step down from the online takeaway firm with immediate effect.

Chief customer officer Peter Duffy will take the role of interim boss as the search for a permanent replacement gets under way.

Just East shares declined 4.4p to 662.8p.

BAE Systems is to sell a majority stake in its UK-based combat vehicles unit to German rival Rheinmetall for £28.6 million in order to ensure the long-term sustainability of its tank business.

The move is part of a wider deal with Rheinmetall to create a joint venture to design, build and support military vehicles that will sustain more than 400 jobs in the UK.

BAE shares rose 5p to 515p.

Brent crude, the international benchmark, traded up 0.04% at 62.52 US dollars (£48.46).

The biggest risers on the FTSE 100 were Melrose Industries up 3.25p to 172.8p, Hargreaves Lansdown up 27.5p to 1,862p, DCC up 90p to 6,530p, and Astrazeneca up 70p to 5,640p.

The biggest fallers on the FTSE 100 were Kingfisher down 9.1p to 217.7p, Antofagasta down 24.2p to 830.6p, Smurfit Kappa down 54p to 2,166p, and Centrica down 3p to 134.15p.

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