London stocks rally, pound softer before Brexit votes

London stocks rally, pound softer before Brexit votes

London Stock Exchange LSE
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LONDON: British stocks jumped on Tuesday (Jan 29) but the pound was softer before fresh crunch votes on Prime Minister Theresa May's revised Brexit deal.

London's benchmark FTSE 100 index was 1.3 per cent higher as trading ended for the day.

Among eurozone heavyweights, Frankfurt and Paris also rose on the back of growing optimism over looming talks to resolve the US-China trade dispute.

Wall Street was slightly higher in mid-day trading.

Oil prices rebounded after tumbling the previous day on worries over a slowing global economy and political instability in key producer Venezuela.

As British lawmakers prepared to hold a series of votes that could reset the course of Brexit, the pound slipped back slightly against the euro and dollar.

MPs are set to vote from 1900 GMT on measures that could include preventing a no-deal Brexit, delaying Brexit, changing the negotiated deal - and even seizing control of the entire process.

'RELATIVELY OPTIMISTIC'

"The FTSE 100 is gaining ground ... with markets looking relatively optimistic about today's parliamentary votes," said IG analyst Joshua Mahony.

Sterling had enjoyed healthy buying in recent weeks on expectations that a chaotic no-deal exit would be avoided.

But, "given the EU's intransigence, the probability of a referendum or an election remains high, and will likely feed European asset volatility over the coming weeks," said Franklin Pichard, director-general at Kiplink Finance.

Aside from Brexit, the main focus is a two-day meeting between China and US officials aimed at resolving the long-running trade war, which has been a drag on equities.

US President Donald Trump will meet China's top economic envoy Liu He during the talks, which start Wednesday, while US Treasury Secretary Steven Mnuchin said he expected "significant progress at these meetings".

In Asia earlier, stock markets mostly fell as the charging of Chinese giant Huawei in the US cast a shadow over the upcoming trade talks.

Beijing meanwhile is struggling to kickstart the world's number two economy, which expanded last year at its slowest pace for almost three decades. A mammoth debt mountain and the US trade war is hampering its efforts.

In company news, after the markets closed, French luxury giant LVMH posted record sales of €46.8 billion (US$53.5 billion) in 2018, up 10 per cent from the previous year as its markets grew in Asia, Europe, Japan and the United States.

Its shares had already gained 0.43 per cent to €259.75 on the Paris stock exchange.

Key figures around 2130 GMT:

New York - Dow: UP 0.2 per cent at 24,579.96 (close)

New York - S&P 500: DOWN 0.2 per cent at 2,640.00 (close)

New York - Nasdaq: DOWN 0.8 per cent at 7,028.29 (close)

London - FTSE 100: UP 1.3 per cent at 6,833.93 (close)

Frankfurt - DAX 30: UP 0.1 per cent at 11,218.83 (close)

Paris - CAC 40: UP 0.8 per cent at 4,928.18 (close)

EURO STOXX 50: UP 0.5 per cent at 3,153.42 (close)

Tokyo - Nikkei 225: UP 0.1 per cent at 20,664.64 (close)

Hong Kong - Hang Seng: DOWN 0.2 per cent at 27,531.68 (close)

Shanghai - Composite: DOWN 0.1 per cent at 2,594.25 (close)

Pound/dollar: DOWN at US$1.3069 from US$1.3163 at 2200 GMT Monday

Euro/pound: UP at 87.48 pence from 86.83 pence

Euro/dollar: UP at US$1.1435 from US$1.1428

Dollar/yen: DOWN at 109.34 yen from 109.35

Oil - Brent Crude: UP US$1.39 at US$61.32 per barrel

Oil - West Texas Intermediate: UP US$1.32 at US$53.31 per barrel

Source: AFP/de

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