British prime minister Theresa May formally invoked Article 50 of the Lisbon Treaty, the official European Union (EU) exit clause, earlier today.
May reiterated that a “bold and ambitious” free trade agreement with the EU will be the aim, giving British companies the freedom to trade with and in European countries
Sterling has been fluctuating between losses and slim gains against a slew of currencies over the past few days.
“We had expected the pound to recover today and indeed it has,” said Kathleen Brooks, research director at City Index.
At lunchtime, the pound was flat against the dollar at $1.245, but was up 0.4 percent against the euro.
“We’re in for a long period of volatility for the pound and UK assets as the government embarks on protracted and hugely challenging Brexit negotiations,” said Neil Wilson, an analyst at ETX Capital. “We could see it move lower still if negotiations take a sour turn – $1.10 is feasible,” he added.
London and other stock markets were largely unmoved by the Article 50 announcement, but Wall Street’s positive lead on Tuesday saw the return of more bullish trade.
The best FTSE 100 performer was the 3i Group, adding 3.8 percent on the strength of a broker upgrade from Morgan Stanley.
The FTSE 250 was almost flat at 18,944.59 points and Hong Kong’s Hang Seng index also stayed flat.
Australia’s S&P/ASX 200 index rose 0.9 percent, while the pan-European Stoxx 600 index was barely changed as energy stocks welcomed further gains in oil prices.
The S&P 500 started New York’s session at 2,355, shedding 3.5 points of the 17 gained in the previous session.