CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
✖

FTSE250 Soars 25 On Brexit Deal Optimism

Article By: ,  Senior Market Analyst
October 11, 2019 8:17 AM
If it wasn’t for the last minute nothing would get done – it would seem that the time pressure of the looming Brexit date has finally sparked a sense of urgency among leaders to move the EU and the UK closer to a deal. 

Whilst a new deal is still not done and dusted by any means, early reports from both sides following the Michel Barnier and Steve Barclay Brexit meeting are sounding optimistic and indicate that a deal could be agreed before the 19th October deadline. Intensive Brexit talks will continue with investors watching developments closely. 

The pound surged a further 1% in early trade, extending 1.8% gains from the previous session and hitting a fresh three week high of $1.2549. Pound trader are growing in confidence that a no deal Brexit will be avoided in three weeks’ time.
With a strong pound and multinationals making up around 70 % of the FTSE 100, the gauge of the top 100 stocks is not necessarily the best gauge for Brexit.

Why is the FTSE 250 a good Brexit fear/ optimsm gauge?

The FTSE 250, which is compiled of mainly domestically focused stocks is soaring up 2.5% from the open. The likes of Marks and Spencer, Galliford Try and Grafton Group have gains into double digits, to name a few.

The stocks on the FTSE 250 are very exposed to the UK economy and UK consumer sentiment. They took a big hit following the Brexit referendum and have experienced a challenging trading environment since as Brexit uncertainty has dragged on consumer confidence. A no deal Brexit could have inflicted significant further damage on these stocks. The prospect of a no deal Brexit being avoided is like Christmas has come earlier and this optimism is being reflected in the soaring prices.
These will be the stocks to continue watching; stocks that could well push higher on increased Brexit deal optimism, or lower if fear of a no deal creeps in  again.

Source: Bloomberg

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.

© City Index 2024