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It
wasn't a completely clear Brexit road ahead. Familiar Irish
border snags remained a spoiler for Northern Ireland's
Democratic Unionist Party [nS8N26G06E], but after three years of
tortuous uncertainty any deal was a deal to cheer.
"We have a great new Brexit deal," British Prime Minister Boris
Johnson said and "Where there is a will, there is a deal - we
have one!" echoed European Commission President Jean-Claude
Juncker as the news broke from Brussels.
[nL5N2722FT][nB5N24302R]
Sterling, which has been the key gauge of Brexit sentiment all
along, jumped more than a percent against the dollar, taking its
gains over the last six days to 6% and which if it holds, will
be a more than 30-year record. [nL5N2722P7]
It ran as far as $1.2988 <GBP=> to the highest against the euro
since May at 0.86 pence. The euro also jumped to a near-
two-month high against the dollar of $1.1139 <EUR=> in its sixth
day of gains in the past seven.
"The deal has been announced, but the key hurdle of being voted
into the UK Parliament remains," said ING's chief EMEA FX and
interest rate strategist Petr Krpata.
London's heavyweight FTSE and the pan-European STOXX 600 <.STOXX>
both jumped 0.6%, having been flat beforehand. UK Gilts
<GB10YT=RR>, German Bunds <DE10YT=RR>, the Swiss franc, gold and
most other safe havens began selling off. [.EU]
Barclays Capital European equities strategist Emmanuel Cau said
tha deal "should provide legs to the rotation from UK exporters
to domestic plays" as it should help rebuild confidence.
TALKING TURKEY
Wall Street was expected to reopen higher and emerging-market
stocks <.MSCIEF> gained for a sixth day -- their longest winning
streak since early April -- after U.S. Treasury Secretary Steven
Mnuchin said U.S. and Chinese trade negotiators were nailing
down a Phase 1 trade deal text for their presidents to sign next
month. [nL2N27126V]
But U.S. retail sales fell for the first time in seven months,
suggesting manufacturing-led weakness was spreading to the
broader economy. [nL2N2701IJ] U.S. consumption has been one of
few bright spots in the global economy, so the data fanned
worries the trade war would ultimately tip the world into
recession.
"While the U.S. suspended a hike in tariffs, it hasn't gone as
far as scrapping the tariffs altogether, so it is hard to expect
a quick pick-up in the economy," said Yoshinori Shigemi, global
market strategist at JPMorgan Asset Management.
The dollar index <=USD> was last at 97.692, having reached its
lowest level since Aug. 27. The dollar was flat at 108.75 <JPY=>
after peaking at 108.90 to the Japanese yen and down against the
euro at $1.11 <EUR=>.
In commodities, oil prices slipped after industry data showed a
larger-than-expected build-up in U.S. crude stockpiles, adding
to concerns that global demand for oil may weaken amid further
signs of an economic slowdown. [nZXN04P700]
Brent crude <LCOc1> futures fell 0.25% to $59.27 a barrel. U.S.
West Texas Intermediate crude <CLc1> lost 0.5% to $53.01.
Turkey's fragile markets remained in focus after the country's
military advance in Syria created tensions with United States
and Europe and incurred mild sanctions. Turkish President Tayyip
Erdogan is to meet with U.S. Vice President Mike Pence and
Secretary of State Mike Pompeo later.
Although the U.S. pulled its troops out of the area to allow
Turkey's push, Pence and Pompeo are expected to urge Erdogan to
declare a ceasefire, something Erdogan says will "never" happen.
U.S. President Donald Trump warned of "devastating" sanctions if
discussions did not go well.
Turkish stocks were down 1.8% and the lira weakened to 5.8877 to
the dollar <TRY=>. It has lost nearly 5% this month, making it
the world's worst performer for October.
(Reporting by Marc Jones, editing by Larry King)
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