Brewing Brexit optimism got sterling salivating on Tuesday, a move that pushed the FTSE from its recent 4-month highs.
With a decent foundation based on the day’s slightly disappointing but still strong UK jobs report, confirmation that Theresa May will return to Brussels on Wednesday for a no-frills meeting with Jean-Claude Juncker appeared to give the pound the edge as trading went on.
Against the dollar it was up half a percent, pushing cable back above $1.299, while against the euro it rose 0.4%, lifting to €1.147.
The pound’s (possibly premature) positivity ensured that the FTSE couldn’t shake its banking sector-led losses. In part thanks to HSBC’s gradually worsening performance – the finance giant was down 4.5% against the 3% drop it saw at the open – the UK index fell 0.5%, leaving it the wrong side of 7200 and around 70 points off of last week’s peak.
Over in the Eurozone the DAX ended up between the day’s two poles, unchanged at 11290 having at points been up 0.4% and down the same amount. The CAC, meanwhile, slipped 0.2% to lurk at 5150.
As for the Dow Jones, its return to trading after Monday’s holiday wasn’t particularly exciting. Investors erred on the side of caution, sending the Dow 70 points lower as the markets waited for more details from the ongoing US-China trade talks in Washington.
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