been a push higher in equities in recent trade with US futures leading the gains despite more concerning rhetoric on the trade front. Stock markets across the Atlantic are expected to open at their highest level in more than a week as investors are seemingly shrugging off worries of a further escalation in US-Sino trade when leaders from the respective countries meet later this week. The FTSE 100 is back at the 7000 level while the pound is up against all of its peers as it looks to recover from Tuesday’s declines.
Trade tensions fail to sour sentiment
Thelatest news on the trade wars front has been pretty much constantly negative of late with US president Trump firing off several broadsides as China, European automakers, Apple (NASDAQ:AAPL) and GM have all come under fire. Chinese president Xi has delivered some remarks which may be construed as positive this morning, claiming that Beijing intend to sharply widen market access for foreign investors in a rare bright spot in the current slew of news towards protectionist measures.
However, even these comments came with the caveat that China will step up their protection of intellectual property rights and the chances of a de-escalation when XI meets Trump later this week seems remote. Despite this, stocks in the US, Europe and UK are looking to move off their recent lows and the ability to rise in the face of negative news could be seen as a real positive heading into year-end as we move into the festive period which has traditionally treated investors well.
Chancellor delivers downbeat post-Brexit assessment
Comments from Philip Hammond that Theresa May’s Brexit deal would make people worse off in economic terms will no doubt irk the PM as she seeks to put on a united front and gain support ahead of a key vote in the Commons next month. The Chancellor claims that purely from an economic point of view, there will be a cost to leaving the EU because of “impediments to trade” but it should be pointed out that he also added that May’s deal “minimises the economic impact while providing political benefits.”
An economic assessment of the Brexit deal
will be published later this morning and will show that no deal would be the worst long term outcome for living standards and the economy. This release will no doubt embolden claims of the government using “Project Fear” once more, but it is hard to argue with the numbers or rationale behind the forecasts from an economic standpoint as no deal is clearly the most disruptive outcome, and therefore likely the worst - at least in
the near to mid-term.