A set of votes late Monday left Parliament paralysed and unable to take a clear course on Brexit despite the clock ticking on a final decision on how the UK will leave the EU. With all of the alternatives to the Prime Minister’s proposal failing to gain a majority vote including a customs union and a repeat referendum the possibility of a no deal Brexit is approaching fast.
As ever, the pound is the clearest gauge of the market’s view on continued uncertainty and is halfheartedly losing ground against the euro and the dollar. However the currency’s weakness is lending some support to the FTSE, helping the index trade higher.
Brexit eroding European markets
Parliamentary disarray is also hitting the euro because a disorderly Brexit has the potential to affect European companies trading with the UK.
Of the European gauges the DAX is possibly in the worst position to withstand a disorderly Brexit as Germany is already flirting with a recession and if its exports of cars and car parts to the UK are affected it would add to problems already created by the slowdown of trade with China.
US economic data more positive than expected
US economic data showed that the country’s economy is not in as bad a shape as feared with manufacturing activity improving in February and spending on construction also on the rise.
There are still signs of decline in growth including the unexpected drop in retail sales but the slowdown seems to be happening at a slower pace than expected.
The dollar has bounced back to the highest level in three weeks against a basket of six currencies.
Asda overtakes Sainsbury in market share
The jostling for market share in the tightly contested UK grocery market has resulted in Asda overtaking Sainsbury's in March as the country’s second largest supermarket chain. The irony of the fact that Sainsbury is currently bidding for Walmart-owned Asda has not been lost on the company’s shareholders and Sainsbury’s shares (LON:SBRY) dipped 0.5% this morning.
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