British Pound “Whacked” by Euro and Dollar on News Parliament’s Brexit Vote is Cancelled – Pound Sterling Live

European legal concept

Image © Mike Chodyra, Adobe Images. 

– May to make statement to parliament at 15:30 GMT

– Sterling dips on news Brexit vote in parliament is off

– ECJ rules UK can stay in European Union

– ECJ Ruling to weaponise stance of remain-leaning MPs

The British Pound fell sharply at the start of the new week on headlines in late morning trade in London that the government is to abandon a vote on the EU-UK Brexit deal, originally scheduled for Tuesday.

Furthermore, reports suggest the Prime Minister is to address parliament at 15:30 GMT to deliver a statement. “Leadsom statement on Commons business expected to follow PM statement this afternoon, which implies they are indeed pulling the vote,” says the BBC’s Political Editor Laura Kuenssberg.

The market has reacted sharply to the developments: The Pound-to-Dollar exchange rate is down 0.4% at 1.2665, the Pound-to-Euro exchange rate is a more substantial half percent lower at 1.1098 ensuring the market is now trading at fresh three-month lows.

“Cable is getting whacked,” observes Neil Wilson, Chief Market Analyst with Markets.com in the wake of the headlines. “May seems to have accepted she had no chance of winning and is seeking to save her premiership by some last minute brinkmanship. Sterling remains at the mercy of highly sensitive news flow around Brexit and this morning has been a case in point.”

“The political uncertainty has seen the UK Pound Pound dip below $1.27,” says Economist Shaun Richards.

“GBP weighed down by lashings of Brexit uncertainty,” says Robert Howard, an analyst on the currencies desk at Thomson Reuters, referencing “reports about the Commons Brexit vote scheduled for Tuesday.”

We find the currency’s reaction a little strange; the market always knew the government was going to lose the vote originally set for Tuesday which would in turn open the door to further uncertainty.

If anything, news the vote is being pulled actually moves the whole process forward somewhat.

Regardless, all eyes now turn to 15:30 when May is to address the House of Commons.

“If she is pulling the vote to go back to Brussels it could suggest a renegotiation of the backstop, or at least clarification. We must note that the EU has categorically said this is the only deal and it seems unlikely it would revisit,” says Wilson, adding:

“Alternatively, this opens up the prospect of May herself going for a second referendum, with voters asked whether they accept this deal or no deal. A complete shambles is about the only way to describe this situation and investors are right to be very cautious about UK assets.”

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ECJ Brexit Ruling Throws More Fuel on the Fire of Uncertainty

The decline in the Pound comes as investors pare back exposure to Sterling in light of growing uncertainty: the cancellation of the ‘meaningful vote’ on the Brexit deal sets in motion a series of political events unseen in scope since the EU referendum of 2016.

To be clear: there is no certainty as to what will happen when Prime Minister Theresa May’s Brexit deal and there are a number of potential scenarios likely to play out.

Our suspicion is that cancelling the vote simply buys the Prime Minister more time as it appears the Conservative party was preparing her ouster in the event of the Brexit deal suffering a large defeat.

On the eve of the now canned vote, the European Court of Justice handed remain-leaning MPs a boost with their ruling that the UK can unilaterally withdraw Article 50 and stop Brexit.

Furthermore, the court ruled:

“Such a revocation, decided in accordance with its own national constitutional requirements, would have the effect that the United Kingdom remains in the EU under terms that are unchanged.”

In short, the UK can remain a member with all the previous UK-specific benefits in place. There was speculation that were the UK to abandon its Brexit bid that the European Union would make strong demands that the country aligns fully with other European nations.

The ECJ has just said there is no basis for such suggestions.

The outcome was actually well signposted with the European Advocate General last week advising the ECJ that the UK could unilaterally withdraw.

“The ECJ decision could embolden Remain MP’s and Peoples Vote campaigners to push for a second referendum if the Withdrawal Agreement fails to pass the UK House of Commons on 11 December.  So far, opinion polls remain tight suggesting political uncertainty will continue to undermine GBP whether there is a new UK general election or another referendum,” says Joseph Capurso, an analyst with Commonwealth Bank of Australia.

The ruling has had marginal impact on the Pound today, but nevertheless bears a potentially significant on what comes next as remain-leaning politicians will now be able to weaponise the ruling to their advantage, ensuring yet further uncertainty as to how the coming days will play out.

“The UK now appears to have the option of revoking Brexit unilaterally and taking a period of time of its own choosing to decide what happens next,” says Malcolm Barr, an economist at JP Morgan

Theresa May’s recent parliamentary defeats – first on access to legal advice and then on the Grieve amendment, which would give MPs more of a say were she to fail to win approval for her withdrawal bill – have radically increased the chances the whole Brexit endeavour could be thwarted.

The probability of the UK remaining in the EU has now doubled to 40%, the highest it has been since the referendum, say analysts at investment bank JP Morgan, offering a fundamental view that supports the formation of a technical floor we see forming under the Pound.

The probability of other outcomes has also been revised by Barr, who has reduced the chances of a ‘no-deal’ Brexit to only 10% (down from 20%) and an orderly Brexit to 50% (down from 60%).

The analysis has profound implications for Sterling traders since it reduces the chances of the main scenario likely to cause further weakness – ergo that of a disorderly Brexit – to only 1 in 10. This suggests a very strong probability the Pound is now underpinned by a ‘hard floor’ at current levels, all other things being equal.

While the ECJ ruling is on paper positive for Sterling we have to stress there is simply too much near-term uncertainty to call direction in the currency and we can only tell readers to stay alert of heightened volatility.

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Stocks making the biggest moves premarket: FB, FDX, TSLA, NTRI, TVPT & more – CNBC

Check out the companies making headlines before the bell:

NutrisystemThe weight loss program company agreed to be bought by Tivity Health for $1.3 billion in cash and stock. Tivity, a provider of fitness and health improvement programs, will pay $38.76 per share in cash and a little over a fifth of a Tivity share for each share of Nutrisystem, giving the deal an implied value of $47 per share. Nutrisystem closed Friday at $34.20.

TravelportThe provider of travel commerce platforms agreed to be acquired by affiliates of Siris Capital Group and Evergreen Coast Capital for $15.75 per share in cash, or about $4.4 billion. Travelport had closed Friday at $15.40, but the stock had jumped five percent last Thursday after reports that the deal was close.

FedExBank of America/Merrill Lynch downgraded FedEx to “neutral” from “buy”, and cut its price target to $220 per share from $304. B of A/Merrill said the “surprise” change in management at the company’s Express division may signal a reduction or delay achieving in its profit improvement target.

Facebook Facebook increased its stock buyback authorization by $9 billion, on top of a previously authorized $15 billion.

Gilead Sciences – Gilead named Roche executive Daniel O’Day as its new chief executive officer as of March 1, 2019. Chief patent officer Gregg Alton will serve as interim CEO from January 1 until O’Day’s start date. The drug maker had said in July that CEO John Milligan would step down at the end of this year.

Deutsche Bank A potential merger between Deutsche Bank and Commerzbank would have the approval of Germany’s finance ministry, according to a Bloomberg report.

Visteon Visteon was downgraded to “sell” from “neutral” at Goldman Sachs, which expects an upcoming business update from the auto parts maker to be a negative catalyst for the stock.

WageWorks WageWorks was upgraded to “market outperform” from “market perform” at JMP Securities, which cites a number of positive factors for the benefits administrator including valuation.

Yelp – Yelp is under fire from longtime shareholder SQN Investors. The Wall Street Journal reports that SQN is planning to send a letter to the online review company’s board pushing it to add new members and to consider all options to get Yelp back on track, including a sale. Yelp issued a statement noting that SQN had provided the letter to the media before sending it to Yelp, but said it is committed to maintaining an open dialogue with SQN and other shareholders, and that it regularly evaluates opportunities to unlock its full business potential.

Papa John’s – Papa John’s founder John Schnatter has engaged a financial adviser to help him review alternative for increasing shareholder value, according to an SEC filing.

Tesla – CEO Elon Musk told “60 Minutes” he does not respect the SEC, and that as largest shareholder in the automaker he can do anything he wants even if a new chairman is brought in.

Universal Display – The provider of organic light emitting diode technology sees its stock join the S&P MidCap 400 as of today. It replaces restaurant operator Sonic, which has been acquired by Inspire Brands.

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Apple falls further into the red for 2018 after Citi slashes target: ‘Trade wars are bad for tech’ – CNBC

Apple shares fell in premarket trading Monday after Citi slashed its price target to $200 a share, saying “trade wars are bad for tech stocks.” The stock fell into the red for 2018 on Friday and is down 25 percent this quarter.

Morgan Stanley (on the weak market in China for iPhones), Goldman Sachs (on the lackluster international reception of the iPhone XR), Guggenheim Partners (on declining iPhone unit sales next year), UBS (on warnings from suppliers and weak overseas sales), HSBC (on over-dependence of a single product) and Rosenblatt Securites (on a lowered iPhone shipment estimates).

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Amazon reportedly plans to launch its first physical ‘Go’ store outside the US – CNBC

The e-commerce company opened its first Amazon Go store at its Seattle campus in January, where people swipe their Amazon Go smartphone app onto a sensor to enter, pick up groceries, and leave without having to go to a checkout or pay at a register. Amazon says it uses computer vision, algorithms and sensors to detect the items a shopper has picked up, before that person’s account is charged. There are now seven Amazon Go stores in the U.S., and the company is considering opening 3,000 stores by 2021.

The U.K. is an important market for Amazon, which said it had seen “record levels” of shopping in the country at the start of its Black Friday sale. It has hired 20,000 seasonal workers for this year’s holiday period.

Amazon had not responded to CNBC’s request for comment at the time of publication.

Read the story on The Telegraph’s website.

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Elon Musk says the SEC can’t stop him from tweeting what he wants – Engadget

When prodded further by host Lesley Stahl, he said: “Yeah, I mean otherwise it’s, “Hello, First Amendment.” Like Freedom of Speech is fundamental.” Musk also continued his tirade against the SEC, which he previously dubbed the “Shortseller Enrichment Commission” on Twitter, this time adding: “I want to be clear. I do not respect the SEC. I do not respect them.”

Musk declared that he’s only abiding by the SEC because he “respects the justice system.” He also said that he handpicked Robyn Denholm as Tesla’s new board chair, and that aside from not wanting to be chairman again, he would prefer “to have no titles at all.”

His latest interview follows appearances on Kara Swisher’s Recode Decode podcast and Axios on HBO. The 60 Minutes interview was filmed at Tesla’s auto plant in Fremont, California, and also saw Musk tackle that infamous pot smoking incident: “I do not smoke pot, as anyone who watched that podcast could tell, I have no idea how to smoke pot. Or anything. I don’t know to smoke anything, honestly.”

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Stocks – US Futures Fall on Trade Concerns By – Investing.com

Investing.com – U.S. futures pointed to a lower open on Wall Street on Monday as fears over slowing global growth and the risk of an escalation in the U.S.-China trade war kept investors on edge.

The fell 8 points or 0.33% to 2,627.38 as of 6:46 AM ET (11:46 GMT) while lost 80 points, or 0.33%, to 24,352. Meanwhile tech heavy decreased 16 points, or 0.24%, to 6,607.38.

Wall Street posted its worst weekly performance since March last week, as slowing economic growth weighed on investor sentiment. Economists predict that 2019 could lead to lower growth and higher interest rates as the trade war between the U.S. and China persists.

Chinese officials summoned the U.S. ambassador to Beijing on Sunday to protest the arrest of chief financial officer of Chinese electronics giant Huawei, Meng Wanzhou in Canada. U.S. officials are investigating her role in the companies operations in Iran.

The arrest of Wanzhou has added to tensions between the two biggest economic countries in the world. U.S. President Donald Trump and Chinese President Xi Jinping agreed on Dec. 1 to a 90-day truce on trade tariffs.

Semiconductor company Micron (NASDAQ:) was among the hardest hit in premarket trading, falling 1.59%, while Facebook (NASDAQ:) decreased 0.22% and General Electric (NYSE:) dipped 0.71%. KeyCorp (NYSE:) was down 1.73% and Halliburton (NYSE:) lost 2.29% after news that CIBC World Markets Inc. decreased its shares in the company by 53.2% in the third quarter.

Meanwhile, Tesla (NASDAQ:) rose 0.67% while Lockheed Martin (NYSE:) gained 0.42%.

In economic news, jobs openings data is released at 10:00 AM ET (15:00 GMT).

In commodities, was flat at $1,252.60 a troy ounce while futures fell 1.62% to $51.76 a barrel.

In currency markets, the which measures the greenback against a basket of six major currencies, rose 0.14% to 96.60.

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