While the pound spent Monday fretfully wringing its hands over the latest Brexit headlines, the Dow Jones pulled back from its record peak.
After closing above 30,200 last Friday for the first time in its history thanks to a sub-par – by pandemic standards, if not the pre-covid-19 norm – nonfarm employment change reading and what that means for Biden administration stimulus, the Dow Jones entered a cooling off period this Monday.
In a potential indicator of its longer-term chances of staying above the 30,000 milestone, a 150 point fall still only left the Dow at around 30,060, essentially in the ballpark of the all-time highs seen before Friday.
This as the Trump administration reportedly prepares one final shot in its cold war with Beijing – the defining foreign policy saga of its tenure – via a series of sanctions against Chinese officials involved in disqualifying elected opposition legislators in Hong Kong.
Those reports are arguably also the root cause of Europe’s losses, with the DAX and CAC down 0.2% and 0.7% respectively (in a minor improvement on where they were at the start of the day).
As for the FTSE, it eked out a 0.2% increase, gains made possible by the pound’s Brexit concerns.
Sinking 1.1% against dollar and euro alike, sterling is seriously worried that, after years and years of negotiations and broken promises, the UK is actually headed for a no-deal departure from the EU. It’s a focus that isn’t going to change until investors have a definitive answer, one way or the other.
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