Brexit: EU and Britain agree on the treaty draft

Britain and the European Union have agreed the Brexit draft treaty on Thursday.

-The deal that will enable us to do this is now within our grasp. In these crucial 72 hours ahead, I will do everything possible to deliver it for the British people, PM Theresa May said.

According to Reuters, the main text of the political declaration is that the countries have agreed to develop an ambitious, wide-ranging and balanced econonomic relationship.

The aim during this week is still that the UK and EU will meet on Saturday to finalise the treaty for the EU leaders summit on Sunday. After that the treaty will be discussed in the UK Parliament for final approval. The UK exit from EU would happen on 29th March 2019.

The transition period, which is to end in December 2020 can be extended for two more years. May has said it must end before a British election due in mid 2022.

Financial markets were mixed today on Friday in the Asian markets and Shanghai- index was down 2,14 % and Hang Seng -index -0,64 % in Hong Kong.  On the other hand the Nikkei 225  -index was up 0,65 % in Tokyo.

Wall Street was closed yesterday due to the Thanksgiving and today on Friday the trading will be closed at 1 pm Eastern time in New York.

Euro was trading up 0,08 % against US-dollar at 1,1412 and sterling- US-dollar was down 0,05 % at 1,287 dollars.


Business Finance

Brexit: May to talk with Juncker on Saturday

UK Prime Minister Theresa May and EU Commission head Jean-Claude Juncker will continue the Brexit-dialoque on next Saturday before the EU Leaders meeting on Sunday. There are still issues like Gibraltar and Fisheries on the agenda.

Mrs May travelled to meet Mr Juncker in Brussels today, but they could not finalize the Brexit-deal yet. According to Reuters, May said the negotiators from both sides would continue working on the text during the week.

– I believe we have been able to give sufficient direction for them to be able to resolve those remaining issues, she said according to Reuters.

Financial markets turned mostly positive today for the first time this week after the tech-stocks decline. For example Apple´s CEO Tim Cook said in an interview this week, that he expects the regulators to give new guidances for tech-companies. He was referring to the global discussions of consumer privacy issues.

In Paris the CAC40 -index ended up 1,03 %, Frankfurt Dax closed up 1,61 % and OMX Stockholm ended up 1,48 %. In London, the FTSE 100 -index closed up 1,47 %.

In Wall Street, Dow Jones ended flat, Nasdaq + 0,92 % and S&P 500 -index up 0,30 %. Also the natural resources like gold, platinum, brent and copper were having positive trend.

Euro gained against US dollar and was up 0,14 % at 1,138 dollars, but sterling was down 0, 09 % and was trading at 1,277 dollars




PM May: Brexit-deal is in the national interest

UK Prime Minister Theresa May said that the Goverment backed Brexit deal is the right one for the UK. She also emphasized the meaning of the deal to the UK as a whole country and said that it is in the national interest. PM May had the press conference at the Downing Street 10, London tonight.

During the press conference she told a couple of times that she believes the deal will be signed with the EU. EU leaders are planning to have the EU meeting on the 25th November.

May also underlined the timetable that UK will leave EU according to the plan, on March 29th next year.

She also argued that the deal will give full controll of boarders, money and law and ensure the employment of the UK citizens.

Stocks in Europe ended mixed, FTSE100 up 0,06 %, German DAX-index down 0,52 percent and CAC40-index down 0,70 percent. In the US, Wall Street was having positive trend, Dow Jones  up 0,56 percent, S&P 500 up 0,87 percent and Nasdaq up 1,54 percent.

Sterling against dollar was trading down at 1,7 % 1,277 dollars and euro against US-dollar was up 0,20 percent at 1,1333 dollars.

Business Finance

PM May: Cabinet backs the Brexit deal

UK PM Theresa May announced that her Cabinet backs the Brexit deal. She said that the decision was in the national interest altough there are difficult days ahead.

– My job is to explain this and I will do it tomorrow in the Parliament, she said in the Wednesday evening in London.

– I firmly believe with my head and my heart that this is a decision in the best interest of the entire UK, she concluded.

Business Finance

Brexit: EU to extend the transition period by a year?

According to Financial Times, the EU is considering extending the Brexit-transition period by an extra year. The news came late Tuesday night, before the EU summit in Brussels on Wednesday.

One of the key issues have been the Northern Ireland border and according to media sources the border issue and extending the transition period are going in hand in hand.

In the financial markets, the sterling gained 0.4 percent to 1,32 US-dollars and 0.3 percent to euro. Ten-year gilt yields rose one basis point to 1.62 percent, Bloomberg reported.

Wall Street was very positive and the main stock indexes gained over 2 % – lead by the tech stocks and good earnings from Goldman Sachs.


Trade tensions and currencies – Brexit deal near?

The trade tensions between the US and China have caused overall speculations about the currencies and their role in the trade talks.

For example the Chinese central Bank Governor Yi Gang said in the IMF and World Bank meeting in Bali, that China will not use the exchange rate as a tool to deal with trade tensions. According to Reuters, he mentioned also that there are plenty of room for interest rates adjustments and that the monetary stance is still basically neutral.

During last week for example ECB Governor Mario Draghi said that the key global risk is a sudden jump in the interest rates. Also the US President Donald Trump has been asking about the Federal Reserve´s monetary policy by  quoting that the dollar is strong. For example the US dollar has gained 2,3 procent against euro during a year.

Last week was also very turbulent in the stock markets and for example the UK stocks were down about 10 procent from the year highs – the Wall Street was able to make a positive turnaround and ended positive for the day.

On yearly basis, the US stock have been perfmorning well with S&P 500 -index up nearly by 8,5 % , Nasdaq up by 14,7 % and Dow Jones by 10,9 %. In Europe, the trend has been negative with the German DAX-index down by 11,2 % and the UK FTSE 100-index down by 7,4 %. The euro has traded down 1,5 % agains the UK pound at the same time.

This weekend is also very important for the next week meetings around the Brexit talks. According to Bloomberg, next week EU & UK meetings are vital in accordance for the breaktrough and keeping the timetable.

kuva-2During the Brexit talks there has been mixed feelings about the future and opportunites among the big corporations. For example Unilever (UNA:NA), consumer goods company,  decided to stay in London, while many of the financial services companies like Goldman Sachs have decided to move some of ther personnel to Frankfurt or Paris. According to Bloomberg, these companies have got a new banking license from Germany: Morgan Stanley, Nomura, Citi and Daiwa.

One of the reasons for the financial companies to departure to Frankfurt has been the ECB´s policy stand of the banking requirements after the Brexit. Companies have made conclusions that it would be easier to operate with a new licence in Frankfurt.

On the other hand, the UK prime minister Theresa May has said that UK would offer the lowest G20 taxes for corporations in order to keep them in the UK. – Our vision is based on openness, innovation, competition, high quality and intelligent regulation, she said at the end of September in New York and mentioned also that ” no deal is better than a bad deal”.