Political uncertainties in Spain, Brussels and Britain has once again put Europe on the back foot with the euro, the pound and European shares all tumbling on Monday.
The pound sterling slid to $1.30 with election fever gripping the country which shows a tightening race between the Labour and the ruling Conservative parties. Chief negotiator, David Davis for Brexit also threatened to walk away from negotiations as the EU blocks his demands. He said that the threat was genuine if the ‘divorce bill’ was too high.
In Europe, euro and Spanish stocks and bonds saw little activity as opposition to Mariano Rajoy’s ruling party returned to front the austerity policies of the Socialists.
Athens, Greece are also seeking a bailout as they face the likelihood of defaulting on their loans.
The dollar index which measures the dollar against six major currencies gained 0.2 percent. Concerns over the firing of former FBI head, James Comey by President Donald Trump and allegations over the administration links with Russia saw the dollar fall this week.
Currency strategist at RBC Capital Markets in London Adam Cole says that they still believe that the dollar is positive.
Optimism Over OPEC Extension of Oil Cuts
Markets are optimistic that OPEC and non-OPEC members will extend the output cuts for a further 6 months at the meeting next week.
Chief commodities analyst at SEB Markets, Bjarne Schieldrop thinks that cutting output seems to be a done deal.
Brent crude rose 40 cents at $54.00 a barrel.
US light crude rose 38 cents at $50.71.
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